Ineos Chemicals: Grangemouth

Chris McDonald Excerpts
Wednesday 17th December 2025

(3 days, 10 hours ago)

Written Statements
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Chris McDonald Portrait The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
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The Government have agreed a landmark partnership with Ineos to secure the strategically important ethylene cracker in Grangemouth, Scotland. This agreement ensures that the future of this vital site is protected and demonstrates the Government’s commitment to support workers and their communities in Scotland and across the rest of the UK.

The plant, like many across Europe, has faced challenging market conditions. Three quarters of the plant’s output is used domestically by our downstream manufacturing sectors. This includes supporting our industrial strategy growth sectors who depend on ethylene supply, and downstream uses ranging from advanced polymers for defence and medical grade plastics in our life science sectors, to advanced manufacturing sectors such as automotive. The Grangemouth plant is crucially important to our critical national infrastructure given the interconnected assets operated by Ineos—the ethylene pipeline system and the Forties pipeline system. This is why we have acted decisively and stepped in to ensure that it is secured.

The agreement consists of more than £120 million in UK Government support and at least £30 million of investment from Ineos. This package will save jobs, reduce emissions and increase productivity, helping to secure the site’s continued operations and long-term competitiveness. It will reinforce the hundreds of millions of pounds of investment that Ineos has already made over the last few years in maintaining operations at the site. We are also creating the conditions for Grangemouth’s long-term future. Through Project Willow, up to £200 million from the National Wealth Fund will support new jobs and projects subject to meeting usual assessment criteria.

This agreement strengthens the resilience of our foundational sectors and their supply chains within the UK, which underpins our industrial strategy. It will ensure that the site remains operational for the foreseeable future and continues to support the commercial strength of the Grangemouth cluster.

Funding for this intervention will be covered by existing budgets that have been agreed as a part of the departmental spending review settlements. The Government set a very high bar for interventions of this kind. This includes assessing the viability of the business, the economic and social impacts of potential public support, and the contributions of the private sector—including shareholders. Where the Government do intervene, they sets clear, strict conditions on how the money is used. We are taking bold action today to support this site, recognising its strategic importance.

We are also backing the wider chemicals sector through the industrial strategy with targeted support to bring down energy costs, including through the British industrial competitiveness scheme—which will slash costs for businesses in sectors including chemicals by up to 25%—and the British industrial supercharger, which will save Britain’s most energy-intensive firms money on their electricity costs.

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INEOS Chemicals: Grangemouth

Chris McDonald Excerpts
Wednesday 17th December 2025

(3 days, 10 hours ago)

Commons Chamber
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Chris McDonald Portrait The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
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With your permission, Madam Deputy Speaker, I wish to make a statement on the agreement the Government have secured to protect vital chemical production and hundreds of jobs at the INEOS ethylene cracker in Grangemouth.

Three quarters of Grangemouth’s ethylene production is consumed domestically by our key industries, and the plant is strategically important for those industries and for UK supply chains more broadly. Its ethylene is essential for critical national infrastructure, including medical-grade plastics used in the health service, and its chemical supply chains are used for water treatment. These materials are also vital to many of our industrial strategy priority sectors, including advanced manufacturing, life sciences and defence, which all depend on a ready supply of them. The plant also links to the Forties pipeline system, which is key for transporting our North sea oil and gas to onshore infrastructure.

Despite the site’s strategic importance, we know that INEOS has faced a number of significant challenges that have had a severe impact on trading. The site, like many chemical complexes in the UK and the EU, has faced the risk of closure. Given the national importance of the plant and its unique contribution to the UK economy, the Government are clear that closure is not an outcome we are willing to accept. That is why I can confirm to the House today that we are stepping in and providing a support package to INEOS of over £120 million, which forms part of a wider £150 million investment with INEOS to help to ensure the site remains commercially viable and sustainable in the long term.

This support package comprises a grant and a Government-backed loan to protect 500 jobs in Grangemouth and many hundreds more within critical supply chains. As part of the agreement, Ineos will continue operations and will invest at least £30 million into the site, on top of the hundreds of millions it has already invested in recent years. The agreement will therefore protect jobs and safeguard taxpayers’ money.

The Government set a very high bar for interventions of this kind. We assess the viability of the business, the economic and social impacts of our investments, and the contributions of the private sector, including shareholders. Where we do intervene, we set clear and strict conditions on how those investments are used. In this case, our funding will secure ongoing operations. It will improve the site’s energy efficiency, decrease carbon emissions and increase productivity. Funding for this support will be covered by existing budgets that have been agreed as part of the departmental spending review settlements.

Interventions of this kind are rare, but when workers’ livelihoods and our strategic interests are at risk, a Labour Government will never hesitate to take action to protect this nation’s assets and economic security. We will work with businesses to build a secure, prosperous future for our industrial heartlands and for the whole of the UK. We are taking bold action today to ensure that the chemicals sector in this country remains strong for the workers and communities who have depended on it for generations. We are also ensuring that this sector can play its part in making the UK a clean energy superpower by the end of the decade. The chemicals sector plays a fundamental role in the supply of parts for wind turbines, for carbon capture and storage, and for our nuclear powerplants. We cannot afford to see those domestic supply chains disrupted, and we will not.

That is why, beyond this agreement, we will improve the business environment for British industries, including our chemicals sector. The industrial strategy is one of the ways we are doing that. Our gas prices remain competitive in Europe, but we are tackling long-standing problems with our high electricity prices. We have already pledged to increase the discount on electricity network charges from 60% to 90% for businesses in sectors such as steel, cement and chemicals. Some 550 of our most energy-intensive businesses will save up to £420 million a year on their electricity bills from next April thanks to that one change alone. Our new British industrial competitiveness scheme will reduce electricity costs for over 7,000 eligible businesses, including chemicals. We want to save them up to £40 per megawatt-hour, or 25%, from April 2027.

Supporting a skilled workforce is also at the heart of the industrial strategy. We are providing an additional £1.2 billion of investment in the skills system by 2028-29. That is because we recognise that a strong economy must rest on strong foundations. That includes our defence capability, energy security and chemicals sector. I say that because hon. Members will know that Ineos is not the only business, and Grangemouth is not the only site, to have experienced challenges over the past few years. That is why we have a vision for Grangemouth’s long-term future that is energy efficient and sustainable.

The agreement we have announced today shows that we will forge the right partnerships between industry, the UK Government and the Scottish Government to make it a reality. As part of those efforts, up to £200 million of investment from our national wealth fund will support new opportunities in Grangemouth. Several projects are already under active consideration. Backed by funding announced by the Chancellor at the Budget, the Scottish company MiAlgae has announced that it will deliver a new biotech project at the site, creating 400 well-paid green jobs.

To support workers at the nearby ExxonMobil Mossmorran plant, which will close early next year, the UK Government and the Scottish Government, alongside Fife council, are setting up a dedicated taskforce. It will ensure that employees affected by that closure will be afforded every chance of securing valuable employment. As part of the agreement being announced today, Ineos Grangemouth has committed to giving those impacted workers a guaranteed interview for available roles at its site. The Grangemouth training guarantee will also be expanded to those employees who provided shared services for the refinery, ensuring that they have the skills and qualifications they need to succeed in the local labour market.

All those measures complement the efforts being undertaken as part of the Grangemouth just transition. That is important, because the agreement we have announced today is not just about supporting a single site or a single company; it is about securing a stable industrial pipeline now and for many years to come. It is about having a clean break from the managed decline of the past and delivering the decade of national renewal that we promised for Grangemouth and for the whole UK. For those reasons, I commend this statement to the House.

Judith Cummins Portrait Madam Deputy Speaker (Judith Cummins)
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I call the shadow Minister.

Andrew Bowie Portrait Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
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I thank the Minister for the advance copy of his statement. The steps announced today by the Government to secure the ethylene plant at Grangemouth are welcome news, especially for the workers at the site who can now look forward to the new year, assured that their jobs will remain at the strategically vital site—and Grangemouth is vital, as the UK’s last plant producing ethylene, a key ingredient in plastics used in advanced manufacturing and the automotive and aerospace sectors. To have lost domestic production capacity for such a core product would have been unconscionable.

However, this move, welcome as it is, demonstrates just how exposed sites such as Grangemouth have become under this Government. This Government’s policies are leading to the deindustrialisation of this country, with unemployment rates soaring and the economy shrinking as a result. From potteries in Stoke to the Prax Lindsey oil refinery in Lincolnshire and, most obviously and glaringly, our oil and gas industry in the North sea, this Government are not just overseeing but engineering the decline of energy-intensive industries in this country.

Of course, I am genuinely glad that 500 jobs at Grangemouth will be protected, but that will be cold comfort for the thousands of workers in and around the wider oil and gas industry who have already lost their jobs, or those who will spend Christmas next week not knowing whether they will have a job next year because of Labour party policy. Last week it was Harbour Energy, and before that it was the Port of Aberdeen, Apache and Petrofac. TotalEnergies has had to merge with NEO NEXT Energy to operate, while Shell has merged with Equinor.

Those businesses all say the same thing: the exorbitant taxation regime, increased and extended until 2030, is driving away investment. Couple that with the utterly astronomical cost of energy here in the UK, pushed ever higher by unnecessary green levies and carbon taxes, and it is no surprise that, in his response to today’s announcement, Sir Jim Ratcliffe said that

“high energy costs and punitive carbon”

taxes were

“driving industry out of the UK at an alarming rate. If politicians want jobs, investment and energy security, then they must create a competitive environment.”

Week after week, more jobs in the sector are lost and critical national assets shut up shop as a direct consequence of policy decisions made by this Government. Since Labour stepped into office, more than 15,000 manufacturing and industry jobs have been lost—that is the scale of the crisis we are dealing with.

Great Britain has a proud manufacturing legacy, but current Government policy towards energy is squandering that legacy, damaging Scottish jobs, and damaging an important national asset.

“There are 200,000 jobs in the UK associated with oil and gas, and they are all at risk unless the government changes course.”

Those are not my words, Madam Deputy Speaker, but those of the chairman of Ineos at Grangemouth.

Today’s announcement is timely, however, as tomorrow I will be visiting Mossmorran to meet the team following the news that the polyethylene plant there will be closing. ExxonMobil’s chairman there has explained that he does not have two of the keys needed for success because of Government policy. He said:

“We’ve had windfall taxes, we’ve had a ban on production licences—I need cheap sources of abundant ethane, and I do not have them, because the North Sea—because of Government policy—is declining rapidly…we paid £20 million last year in CO2 taxes, that will double in the next four or five years.”

What is shocking, though, is that for some inexplicable reason the Secretary of State for Scotland chose today to attack ExxonMobil when explaining why it was not receiving the same support as Grangemouth, saying that the management

“weren’t able to give us a pathway to profitability.”

Of course they cannot do that—at every turn this Government are putting up hurdles, shutting down the North sea and taxing these businesses until they burst. Honestly, this Government just do not get it. They are not listening.

Today’s announcement does not even scratch the surface when it comes to rectifying the damage and pain that this Government have inflicted on industry in this country. Given that this is the second time this Government have launched an unprovoked attack on a leading investor in the United Kingdom, does the Minister want me to pass on an apology from the Government when I visit Mossmorran tomorrow?

Today’s announcement is welcome, but this Government could do so much more. We should scrap the energy profits levy and remove the punitive carbon taxes—we are not getting an exemption to the EU emissions trading scheme anyway, according to the EU Commission. We should incentivise, not punish. A Conservative Government will do all this and more when we return to office in three years’ time—unfortunately, those are three years I do not think British industry has.

Chris McDonald Portrait Chris McDonald
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I start by thanking the hon. Gentleman sincerely for welcoming the support for Grangemouth—it really must be the season of good will. On this occasion, I can assure him that he is correct: this is the last ethylene plant, so we can agree on that this time.

The hon. Gentleman talked about the business environment for the chemicals industry. I thought I had set that out reasonably well in my statement, but perhaps not. I shall just say a bit more. On energy costs, we already have the energy-intensive industries scheme and, as I mentioned, we have increased the level of the supercharger. The British industrial competitiveness scheme will come in in 2027 with an additional 25% reduction. He may be interested to know that our electricity costs are already more competitive than many countries in Europe, but not France and Germany, which are the benchmark for me. That is why we are introducing the British industrial competitiveness scheme. On gas, after policy costs we are already competitive. These businesses trade internationally, and our success in striking international trade deals with the EU, the US and India, and with Korea just this week, means that there are more market opportunities all the time.

The shadow Secretary of State made the contrast with ExxonMobil. I reiterate the point that this Government —the Government would always do this, as I am sure he would expect—are investing in a business with a viable and sustainable future where there is a viable business plan, primarily because the owner of the business has invested in the business over time. As I said a few weeks ago in my statement on Mossmorran, ExxonMobil had failed to invest in that plant, and that is why it said that there was a £1 billion investment gap.

On jobs, in the clean energy sector we are creating 40,000 new jobs in Scotland alone and 800,000 jobs across the whole of the country. This is a transition that the Government are actively engaging in and managing. The shadow Secretary of State says that a Conservative Government would do something different from what they did last time, but they did not do anything last time. When Ineos announced in November 2023 that it was going to close its refinery, the Conservative Prime Minister at the time said, “That’s a commercial decision.” They did nothing about it—nothing at all.

Investment in this area is very important, so I refer the shadow Secretary of State to an article that was published this morning by my noble Friend Lord Stockwood, the Minister for Investment. He talked very carefully about the international investment environment and the performance of the UK economy and lamented the fact that so many people in this country—so many Cassandras, such as the shadow Secretary of State—are constantly talking the economy down and frightening investors away. I think it is about time he recognised the success of our clean energy industries and the success of this Government’s industrial strategy and stopped talking Britain down.

Patricia Ferguson Portrait Patricia Ferguson (Glasgow West) (Lab)
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I thank the Minister for his statement, I thank him and the teams across Government who have worked so hard to secure the deal to protect jobs at Grangemouth. I also want to commend all those in Government who have worked so hard to ensure that Babcock flourishes, Methil stays open, and BAE Systems secures contracts with Norway, and just last week they also secured the MiAlgae deal for the Grangemouth site too. All of that stands in stark contrast to the actions of other parties who had, or perhaps should have had, a role in these matters. Can the Minister reflect on that fact and give us some more information about what other developments we see in Grangemouth in the weeks and months ahead?

Chris McDonald Portrait Chris McDonald
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My hon. Friend is quite right, and I would also like to thank her for her engagement on these subjects as well. She rightly pointed out what a vibrant industrial community there is around the Grangemouth area. Already we have companies, such as Babcock, that are keen to recruit people in that local area and that recognise the skills of the workers who will no longer be employed at Mossmorran from February onwards. With the support that the Government have put in place, including the taskforce led by Fife council, and with the Scottish Government and the UK Government working together in concert, I am confident that we will find new jobs for those people, recognising their very high skills.

My hon. Friend mentions MiAlgae—£3 million of support was announced by the Chancellor of the Exchequer in the Budget. This great company will be operating on the Grangemouth site, directly in line with the strategy set out in Project Willow, which was commissioned by my right hon. Friend the Prime Minister and which he spoke about at the Liaison Committee earlier this week. That points directly to the bright future for Grangemouth.

Judith Cummins Portrait Madam Deputy Speaker (Judith Cummins)
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I call the Liberal Democrat spokesperson.

Sarah Olney Portrait Sarah Olney (Richmond Park) (LD)
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I thank the Minister for advance sight of the statement. I welcome the Government’s announcement that they are stepping in to offer support and protect jobs in this vital industry. We have a duty to safeguard our national security and economic prosperity, and to ensure a fair transition to clean energy. This statement is a step in that direction.

We have long been champions of British industry. We are proud of the industrial policies that we introduced in government, and we must never return to the neglect we saw under the Conservatives, who scrapped our industrial strategy. Having said that, we need to see a far more cohesive plan from this Government to support British business, including our chemicals sector.

High energy costs are a fundamental challenge. The industrial competitiveness scheme will support the 7,000 most energy-intensive firms, but it will not launch until April 2027. Will the Government confirm whether the Grangemouth plant will be included in the scheme? Do Ministers acknowledge that if the scheme had been in place earlier, the situation might have been avoided? Does the Minister agree that we need a long-term plan to slash energy costs for households and businesses alike by seriously investing in renewables and decoupling electricity from gas prices?

Finally, I must press the Minister on another huge added cost for which the Government are responsible, which is of course the national insurance increase. Will he tell the House what is the tax hit imposed on the Grangemouth plant through the national insurance hike since last year’s Budget? Is it greater than the £50 million Government grant handed to Ineos today?

Chris McDonald Portrait Chris McDonald
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I thank the hon. Member for recognising the importance of both the site and the Government’s intervention. She mentioned the £50 million grant. It is important that hon. Members look at that in the context of the total package: a grant and an investment from the owner of the business—and, as the owner of the business said today, an agreement in principle for a profit-sharing arrangement.

That points to the hon. Member’s other question about the detail of the industrial strategy. This industrial strategy is a significant break with the past. It is not about last-minute interventions, which is what the previous Conservative Government did or did not do, depending on how the mood took them. It is about a serious partnership and engagement between Government and industry to ensure that we have sustainable industry in the UK.

The hon. Member asked me about energy costs. I mentioned earlier the relative position on energy costs. Of course, we are doing more on that, and I intend to do much more. In answer to her question on whether it would have helped had the scheme been in place earlier, clearly it would have helped if there had been a Labour Government in place earlier. That would be my advice: always vote Labour.

Bill Esterson Portrait Bill Esterson (Sefton Central) (Lab)
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I very much welcome the protection of 500 jobs at Grangemouth and the commitment to making the most of the energy transition through this investment in carbon capture and storage, in components for wind turbines and indeed in nuclear power plants, as the Minister mentioned in his statement. I turn to the very high electricity costs that industry faces. We have talked about this before, and I raised it with the Prime Minister on Monday at the Liaison Committee. What alternative options are available? The British industrial competitiveness scheme is a very good step in the right direction, but many businesses who will not qualify for that scheme also need help with their very high electricity prices. What is the Minister working on that will start to move the dial for those businesses as well?

Chris McDonald Portrait Chris McDonald
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I thank my hon. Friend for the close attention he gives to this area through his chairmanship of the Energy Security and Net Zero Committee. He started his question by mentioning the 500 jobs at Grangemouth, which perhaps we have not discussed enough. I really do understand how this announcement from the Government will bring certainty to those workers at Grangemouth as well as their families and their local community. It is incredibly important that we acknowledge that.

On energy costs, my benchmark is how competitive we are in Europe. I mentioned how our electricity costs—particularly our industrial electricity costs—are cheaper than those in some countries in Europe, such as Italy, the Netherlands and Spain, but more expensive than in France and Germany. The British industrial competitiveness scheme will take us a good way towards that, and we are already seeing the benefits of our investment in clean energy. As I have previously said at the Dispatch Box, from 2030 onwards we will see some significant reductions, particularly as we are bringing forward interconnectors that will connect not only the UK with other countries, but wind farm to wind farm—it is always windy somewhere in the North sea—which will help to release capacity and drive down costs. My hon. Friend will see that through both our policy measures and our investment in infrastructure.

David Mundell Portrait David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)
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It would be wrong not to commend the hon. Member for Alloa and Grangemouth (Brian Leishman) on this announcement as he has always been such a strong advocate for jobs at Grangemouth. Indeed, owing to his willingness to speak out against his Government, he lost the Labour Whip.

I noted from the photographs issued around today’s launch that workers at Grangemouth did not seem overly happy to see the Chancellor. Perhaps that was because they know that her policies, which continue to attack the oil and gas industry—particularly through the windfall tax—are leading to the undermining of the oil and gas industry across Scotland.

Chris McDonald Portrait Chris McDonald
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I thank the right hon. Gentleman for mentioning my hon. Friend the Member for Alloa and Grangemouth (Brian Leishman). I am sure that he would have liked to be here, but he was invited by the Secretary of State for Scotland to join him on the visit. He and I have spoken over the last few weeks. I assure the right hon. Member that I very much value my hon. Friend’s contributions, his relationship and his support, and I know that he is as pleased as I am by the announcement.

Euan Stainbank Portrait Euan Stainbank (Falkirk) (Lab)
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People in Falkirk, Grangemouth and across Forth valley are delighted to see the decisive action taken by this Government to preserve 500 jobs in our community. The £120 million investment and £150 million deal are Labour’s industrial strategy in action. It protects our industrial community and keeps essential national infrastructure viable. I hope that there is a consensus in this House that that is a welcome, positive step. It is worth noting that, earlier this year, the head of external affairs for INEOS told the Scottish Affairs Committee that prior to the November 2023 announcement of the refinery’s closure,

“Both Governments were given the opportunity, the data and access to the data to make an investment decision, and neither Government chose to do that.”

Both the Tories and the SNP had the opportunity in government to support workers at Grangemouth, but they did not lift a finger. Contrast that with this Government’s approach to the ethylene plant, acting decisively before it was too late.

Our action today and further action support new industry, with the welcome announcement last week of MiAlgae bringing 400 jobs across Scotland. Grangemouth’s industrial future must move forward and the Labour Government are providing substantial further resources towards that. Will the Minister provide us with greater detail on what guarantees the Government have received from INEOS for the long-term viability of the ethylene site at Grangemouth and when Grangemouth can expect further funding announcements from the National Wealth Fund’s £200 million commitment, as well as the additional £14 million secured by Scottish Labour MPs in the Budget last month, to get announcements made soon?

Chris McDonald Portrait Chris McDonald
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I thank my hon. Friend for his continued support for his constituents and the Grangemouth site. He welcomes the announcement and, quite rightly, he then presses me for more funding too. Further to the remarks that my right hon. Friend the Prime Minister made to the Liaison Committee earlier this week, on the £200 million committed earlier this year for projects through the National Wealth Fund, those projects are being examined and shortlisted. I hope that they will come forward soon. I also take this opportunity to commend Siobhan Paterson, councillor for Upper Braes on Falkirk council, who has supported my hon. Friend in this work. I hope that when voters go to the polls for the Scottish parliamentary elections in Falkirk East and Linlithgow, they will recognise that and vote Labour too.

Stephen Flynn Portrait Stephen Flynn (Aberdeen South) (SNP)
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I am glad that the hon. Member for Falkirk (Euan Stainbank) did not get an invite, because we got to hear his excellent speech then.

Five hundred jobs being saved is incredibly important and, contrary to what the Prime Minister said earlier, everyone will welcome that, but we cannot escape the fact that 500 jobs are being lost every two weeks in Scotland’s North sea—not my figures but those of Paul de Leeuw from Robert Gordon University, and they are emphasised by the GMB trade union, local charities and industry itself. The Chancellor, while at Grangemouth —[Interruption.] I do not know why Labour Members make quips about people losing their jobs in the North sea. How dare they! While the Chancellor was at Grangemouth today, she was asked whether she agreed with that expert analysis. She said no. Does the Minister agree with her?

Chris McDonald Portrait Chris McDonald
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I sincerely thank the right hon. Gentleman for welcoming the announcement. The season of goodwill really is spreading right across the House. He asks a serious question about the transition. We have made no bones about this: oil and gas is an incredibly important industry for the UK and will be for decades to come; but as the oil and gas basin declines, it is important that there is a transition. Fundamentally, that is the difference between this and previous Governments and the point of our industrial strategy.

The right hon. Gentleman mentions Robert Gordon University, which also identified that 90% of workers in the oil and gas sector have skills that are readily transferable into the 40,000 jobs that we are creating in Scotland in clean energy industries. That is in marked contrast with the SNP. In September, Professor Mariana Mazzucato—he may have heard of her because she was an adviser to the Scottish Government—said that the SNP Ministers in Scotland, on industrial strategy, talk the talk but do not walk the walk. This Government are walking the walk.

Frank McNally Portrait Frank McNally (Coatbridge and Bellshill) (Lab)
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Is it not the stark and inconvenient truth for the Opposition parties that for years the Tories and the SNP sat on their hands and allowed the industrial needs of Scotland to go to the wall? Does my hon. Friend agree that, with this £120 million package, this Government are serious about backing our strategically vital industries as well as protecting thousands of jobs on the site and through our supply chains?

Chris McDonald Portrait Chris McDonald
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I do agree with my hon. Friend. It really is astonishing how the previous Conservative Government and the SNP Government in Scotland were prepared just to stand by and let the refinery at Grangemouth close after having been given data for years and deciding not to do anything about it at all. He rightly mentions the supply chains, and the multiplier of jobs in the supply chains is much greater. We recognise that this is a good investment for the taxpayer, not just to secure the vital product that we need in our chemicals and defence industries or because the ethylene plant is important in its own right, but to spread the economic benefits through the supply chains in Scotland and beyond.

Harriet Cross Portrait Harriet Cross (Gordon and Buchan) (Con)
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First, like everyone else, I welcome 500 jobs having been secured, but 500 jobs a fortnight are being lost from the oil and gas sector because of this Government’s policies. The Minister has spoken about the supply chain, but those jobs and skills in the supply chain are being lost and will not be there for the transition because of the energy profits levy. The Government have defined what a windfall is. There are no longer windfall prices or windfall profits, but there is still a windfall tax. When will the Government get rid of the windfall tax to protect the supply chain, the oil and gas sector and our vital industries?

Chris McDonald Portrait Chris McDonald
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I thank the hon. Lady for her welcome for the announcement. I think that is something that we can share across the whole House. I would just reiterate the point that the Government recognise the importance of the oil and gas sector. Of course it is important to the UK, to the people who work in it and to local communities as well, but we also recognise that the North sea is a declining basin. We have taken the actions, through our clean energy jobs plan and our clean energy initiatives, to ensure that we secure the supply chains for those clean energy jobs here in the UK. Again, this is a marked contrast between this Government and the previous Conservative Government, who were proud to boast of the UK being the largest market for offshore wind but enabled those jobs to be located in Denmark and other countries around the North sea. We do not think that is acceptable. That is why we are bringing the jobs here and helping workers to transition into those industries.

Tracy Gilbert Portrait Tracy Gilbert (Edinburgh North and Leith) (Lab)
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I strongly welcome this announcement, which, along with the agreement of the Forth green freeport full business case, demonstrates this Government’s commitment to reindustrialising Grangemouth, Leith and the wider Forth area. Can the Minister provide any details on when we will see the £25 million of seed capital attached to that deal being deployed to further secure and create jobs across the area?

Chris McDonald Portrait Chris McDonald
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My hon. Friend makes the point incredibly well about the need to reindustrialise and create good industrial jobs. It is my mission as Industry Minister to release additional productive capacity in the UK that will increase our manufacturing output and improve our productivity and balance of trade. That is rare—it might be decades since a Government have had this level of ambition for our industrial and manufacturing sectors—but for us it is about not just ambition and words but delivering jobs on the ground.

John Cooper Portrait John Cooper (Dumfries and Galloway) (Con)
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It would be churlish of Opposition Members not to recognise the importance of these 500 jobs or welcome their being saved, as it would for Government Members not to acknowledge that we are seeing a sort of self-licking ice cream here—a self-perpetuating system whereby the Government have to intervene in industries that are being damaged by their own policies. Industry that is hanging on by the skin of its teeth will not take well to the news of cheaper energy prices in due course—years down the line—because it is almost at the edge of going out of business. Instead of measuring ourselves against expensive Italy and France, should we not be looking at the much cheaper prices in the United States and China?

Chris McDonald Portrait Chris McDonald
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I enjoyed the analogy about the self-licking ice cream, but it demonstrates a lack of understanding of what a real industrial strategy is on the Conservative side of the House. We all like to think that things are simple, but then we grow up. It is important to recognise that these industries are trading in international markets and need to abide by their rules. What we have done is to create a package that supports a sustainable business plan for that industry. The hon. Member mentions the lower energy prices in the USA—I acknowledge that the USA has lower energy prices, primarily due to its decision to introduce fracking. We have decided not to do that. Is he saying that he would like to do that? If he would, that is fine, but it is a point of difference between us—we will not do that. Our policy is to ensure that our industries remain competitive without that.

Torcuil Crichton Portrait Torcuil Crichton (Na h-Eileanan an Iar) (Lab)
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I thank the Minister for the statement and the work his team and the Scotland Office team did in securing the 500 jobs at Grangemouth. I also pay tribute to the former Business Secretary, my right hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds)—now the Chief Whip—for the work he did on this deal and on keeping the lights on last Christmas at Harland & Wolff in Arnish, Methil, Belfast and Appledore. Then as now, voters and workers expect the two Governments to work together, but the Minister will confirm that the SNP sat on its hands over Grangemouth. The SNP checked out—as it has checked out today—on standing up for Scotland’s workers.

Chris McDonald Portrait Chris McDonald
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My hon. Friend is right to mention the hard work of the Chief Whip and former Business Secretary, because deals like this with international businesses require a significant amount of discussion and engagement. That is precisely the point of our industrial strategy: it is a partnership in which the Government work closely together with businesses to secure investment for the long term. Investment like this hangs around for a generation and provides generational opportunities for employment in local areas. We know that the decisions that this Government are making will provide those employment opportunities for people in Grangemouth and across Scotland for generations to come.

Bobby Dean Portrait Bobby Dean (Carshalton and Wallington) (LD)
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The Minister mentioned in his statement the £200 million for projects in Grangemouth from the National Wealth Fund. I would like to raise with him a concern that was raised in evidence to the Treasury Committee, which is that the National Wealth Fund has to operate on the riskier end of project proposals because it does not want to crowd out private investment, but that means necessarily that many projects will fail. The worry is that politicians will not be ready to defend projects that fail under the National Wealth Fund. Does the Minister agree with that assessment, and is he willing to accept that, given the risk profile of the National Wealth Fund, some projects will fail as part of the deal?

Chris McDonald Portrait Chris McDonald
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I very much welcome the hon. Member’s question because it gives me an opportunity to talk about risk appetite in investment, which I certainly am interested in—if other Members are not, I apologise in advance.

The National Wealth Fund is doing something special and different, but it is also worth looking at it alongside the other tools that the Government have: the British Business Bank and UK Export Finance. The hon. Member is right that the National Wealth Fund’s job is to crowd in, so it should not be at the easy end of the investment; otherwise, it would be crowding out. It has a target to produce a return on investment. Ultimately, the National Wealth Fund needs to take a portfolio approach that delivers that return. I know that in the past, industrial strategies in this country have suffered from casual approaches around things like “picking winners”—that sort of language is incredibly unhelpful. The point of taking a portfolio approach is that, of course, some businesses will succeed and some will not. Frankly, if every business the National Wealth Fund invests in succeeds, its risk appetite is in the wrong place. Some businesses will fail—we accept that; that is absolutely the point of the approach—but as a result of the National Wealth Fund’s investment partnering with industry in the commercial sector to de-risk projects, we will see some big successes, too.

Douglas McAllister Portrait Douglas McAllister (West Dunbartonshire) (Lab)
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This is such welcome news for Grangemouth and Scotland just prior to Christmas. My thanks go to the Minister and all Departments that worked jointly to secure the deal. It is a pity that the SNP could not bring itself to mention the Grangemouth investment earlier today at PMQs—perhaps after decades of failure, the SNP cannot recognise success. Does the Minister agree that both the SNP and the Tories sat on their hands while the future of jobs at Grangemouth was at risk? Does he agree that today’s announcement demonstrates that Scotland needs a Scottish Labour Government in Holyrood to secure more good jobs?

Chris McDonald Portrait Chris McDonald
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My hon. Friend is correct that the Government’s decision here and their previous industrial strategy decisions have been in marked contrast to the decisions of the Scottish National party and the Conservatives previously.

There is something astonishing about this. I know that the Conservatives are hidebound by their free market ideology, which means that they are prepared to let British businesses and jobs go to the wall, but surely they should stand up for things like defence and national security, for which these businesses are so vital? They support our defence supply chains, as well as health and water. It should be natural for the Conservatives to stand up for things like that. The past inaction of the Conservatives and the SNP on this issue has been astonishing. The big message to the voters of Scotland is: vote Labour in the spring.

Graham Leadbitter Portrait Graham Leadbitter (Moray West, Nairn and Strathspey) (SNP)
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I know that Government Members forget which Parliament they are actually in—who knows, maybe they would feel better in the Scottish Parliament.

This is a welcome announcement. For months now, the Scottish Government have been calling on the UK Government to intervene to protect jobs at Grangemouth and Mossmorran at a scale seen in other parts of the UK. The news will give some much needed Christmas cheer, at least to the Grangemouth community and the workers at Ineos Olefins & Polymers. Last week the Scottish Government, jointly with the UK Government and Celtic Renewables, announced an £8.5 million investment at the Grangemouth industrial cluster, including in MiAlgae. That will create up to 460 jobs, demonstrating that a long-term industrial future at the site is achievable. We will continue to do all we can within the limited powers that the Scottish Parliament has.

However, the announcement today does not help those at the neighbouring refinery whose jobs have already been lost. Although there may be some crossover support for nearby Mossmorran workers, there is still a substantial gap in support. Will the Minister finally accept that one of the most fundamental causes of the need for support is the fiscal regime being inflicted on oil and gas and the use of the energy profits levy, which make a just transition a near impossibility?

Chris McDonald Portrait Chris McDonald
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The hon. Gentleman mentions the refinery; as I said earlier, Ineos made the final decision to close the refinery in November 2023, having provided data for years to the Conservative Government in Westminster and the SNP in Holyrood, who said and did nothing.

The hon. Gentleman talks about the scale of investment; I am really surprised, to be honest, that he has not raised that even more firmly. We are talking about a complete package of investment in Grangemouth, announced by this Government, that approaches half a billion pounds: £100 million in the summer, £200 million from the National Wealth Fund, £14.5 million in the Budget and £150 million in this package. That is only a rounding error shy of half a billion pounds for Grangemouth. I would have thought that the SNP would at least acknowledge that.

Katrina Murray Portrait Katrina Murray (Cumbernauld and Kirkintilloch) (Lab)
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I pay tribute to all the Ministers across all the Departments who have worked together to get this over the line. I also pay tribute to my hon. Friend the Member for Falkirk (Euan Stainbank) for not giving up and making sure that it happened.

Grangemouth matters to all of us; we all have constituents who work in the complex or the supply chain. There has been real investment. As a result of announcements over the last few months and again today, we can talk about new highly skilled jobs for a generation. We are again able to talk to people locally about how important it is to get jobs in the advanced manufacturing and chemical sectors. Given that skills are devolved to the Scottish Government, how is the Minister liaising with them to make sure that we are getting that investment for our young people?

Chris McDonald Portrait Chris McDonald
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My hon. Friend spoke powerfully about how Grangemouth matters to the local area. I was chairing a roundtable of the chemicals industry at the Wilton cluster in Teesside; those who, like me, have worked in the chemicals industry or work there now know that Grangemouth matters to all of us across the United Kingdom. The support of the workers and families in Grangemouth makes a big difference to all our lives.

My hon. Friend mentioned jobs. I have talked about the jobs in the clean energy sector created in Scotland and the rest of the country. Last week, I saw that for myself when I attended a clean energy jobs fair at the port of Tyne. I spoke to apprentices excited about the new job opportunities that this Government are creating. The one thing that they know—they heard it from me and said it themselves—is that Reform are coming for their jobs. They know that firmly, and should certainly take it into account when they vote.

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Chris Murray Portrait Chris Murray (Edinburgh East and Musselburgh) (Lab)
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I strongly welcome today’s announcement, which is important not only for workers in Grangemouth but for the wider Scottish economy. Whether it is today’s announcement about Grangemouth, protecting shipbuilding on the Clyde or the supercomputer in Edinburgh, the Labour Government are standing up for workers and for Scotland’s strategic industries. Does the Minister agree that whereas Labour stands up for manufacturing, the SNP can only manufacture grievance?

Chris McDonald Portrait Chris McDonald
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I certainly do agree with my hon. Friend. Given that he represents Edinburgh, he might like to learn an interesting Grangemouth fact: if the Government had not stepped in to support Ineos, the Grangemouth site would be flaring enough gas every day to power the entire city of Edinburgh, such is the scale and importance of the Grangemouth site.

Judith Cummins Portrait Madam Deputy Speaker
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I call Dr Scott Arthur to ask a succinct question.

Judith Cummins Portrait Madam Deputy Speaker
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Order. Minister, I need you to lead by giving an answer that is the definition of succinct.

Chris McDonald Portrait Chris McDonald
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I will try to do that, Madam Deputy Speaker. Grangemouth certainly has great potential for the manufacture of sustainable aviation fuel, along with our other clusters. My hon. Friend mentioned managed decline, but it was worse than that: it was complete indifference to industry and manufacturing in the UK.

Johanna Baxter Portrait Johanna Baxter (Paisley and Renfrewshire South) (Lab)
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I will try to keep my question brief. The SNP and the Tories sat on their hands while jobs and livelihoods were at risk, so I warmly welcome the announcement today and I thank the Minister and all Departments involved. The announcement not only protects 500 jobs; it is an investment in our national security. Does the Minister agree that it is only Labour that is backing business, backing workers and backing Scotland?

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Chris McDonald Portrait Chris McDonald
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My hon. Friend is right that this is an investment in our national security, our infrastructure, our industry, the workforce and the opportunities for young people in the Grangemouth area.

Melanie Ward Portrait Melanie Ward (Cowdenbeath and Kirkcaldy) (Lab)
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Today’s news of UK Government investment in Grangemouth is welcome. Following the devastating announcement by ExxonMobil about job losses at Mossmorran in my constituency, the Mossmorran taskforce is now up and running to give maximum support to the workforce and to consider the future of that site. I welcome the news today that the Mossmorran workers will be prioritised for interview for new jobs created at Ineos in Grangemouth. The Minister and I have discussed this, but will he confirm that the Government are exploring investing in possible alternative futures for the site and the workforce at Mossmorran?

Chris McDonald Portrait Chris McDonald
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Industrial sites like the one at Mossmorran are incredibly valuable to the UK. We mentioned the strategic sites accelerator in our industrial strategy, and I would be interested to explore whether Mossmorran could be a part of that. It is important that we do that and that we move fast, because I learned only today that prior to this, the SNP-led Scottish Government have not held a single meeting about planning transition for Mossmorran, so we will have to run fast to catch up.

Graeme Downie Portrait Graeme Downie (Dunfermline and Dollar) (Lab)
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In common with colleagues, I thank all the Members on the Government Front Bench for their work on this investment, including the former Secretary of State for Scotland, my right hon. Friend the Member for Edinburgh South (Ian Murray), and the current Secretary of State. Grangemouth can be seen from the Fife coastal path in my constituency, and many of my constituents work at Grangemouth. While the site was totally ignored by the SNP and the Tories for years, this Government have dutifully and quietly gone about their work of finding an effective solution that will not only protect 500 jobs, but create more in the future, showing the commitment that this Government have to the Forth valley. Does the Minister agree that this shows what can happen when we have a constructive Labour Government, and that we could do even more with Anas Sanwar as the First Minister next year?

Chris McDonald Portrait Chris McDonald
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I do agree with my hon. Friend. I am sure that with Anas Sarwar as the leader at Holyrood, we will be able to implement the Government’s work on Project Willow, which has identified Grangemouth as the ideal site for plastics recycling, biofuels and other projects that will maximise the local competitive advantage and the skills of the workforce.

Richard Baker Portrait Richard Baker (Glenrothes and Mid Fife) (Lab)
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After the Tories and the SNP did nothing for so many years to address the long-term future of Grangemouth, it is hugely welcome that Labour Ministers have made this announcement, which offers opportunities to workers in Fife affected by the closure of the ExxonMobil plant at Mossmorran. What further opportunities will the modern industrial strategy offer for skilled jobs in high-growth industries in Scotland, including at the Methil yard in my constituency, which was saved by this Government?

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Chris McDonald Portrait Chris McDonald
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My hon. Friend is right to point out that it is only this Labour Government who have made this decision. This is an appropriate time to identify that the intervention in Grangemouth has a significant impact on securing our ethylene pipeline, which runs across the whole of the UK, as well as on chemical plants in Runcorn and the Forties pipeline. That demonstrates that interventions like this and plants such as Grangemouth work well when we are all part of an integrated United Kingdom.

Melanie Onn Portrait Melanie Onn (Great Grimsby and Cleethorpes) (Lab)
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Members might ask, “What has Grimsby got to do with Grangemouth?” Well, this is great news for Grangemouth, but I am afraid it will be cold comfort to the workers at the Prax Lindsey oil refinery, where 400 directly employed people have already lost or will lose their jobs by March, along with hundreds more in the supply chain. They will be asking, “Why the investment there but not here?” Is there any good news on the horizon for jobs in petrochemicals or energy in the Humber?

Chris McDonald Portrait Chris McDonald
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That is exactly the right question to ask about the Prax Lindsey oil refinery. One of the fundamental differences between the two is the Government’s ability to deal with the owner. The owner of the Prax Lindsey oil refinery left the business in a really terrible state. Of course, we all care very deeply for the workers there and for the families in Humberside; having worked in Humberside myself, I empathise greatly with them.

We are now in the late stages of the process with the official receiver, who has confirmed some redundancies because the offers he has received do not see refinery production returning within the next few years. We hope that process will conclude in the new year. I believe the jobs are guaranteed until March, and the Government have provided significant transitional support to help the workers to move into other jobs in the local area.

Ministerial Correction

Chris McDonald Excerpts
Tuesday 16th December 2025

(4 days, 10 hours ago)

Written Statements
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Chris McDonald Portrait The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
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The Minister for Digital Economy (Baroness Lloyd of Effra CBE) has today made the following statement.

The Government’s answer to written question HL985, published on 8 October 2024, included the following paragraph:

“UK Seabed Resources Limited has two International Seabed Authority exploration contracts, UKSR1 and UKSR2. These have an initial period of 15 years with the contract period of UKSR1 ending in 2026 and UKSR2 ending in 2027.”

That paragraph contained errors, so I am correcting the record today. The paragraph should have read as follows:

“UK Seabed Resources Limited has two International Seabed Authority exploration contracts, UK1 and UK2. These have an initial period of 15 years with the contract period of UK1 ending in 2028 and UK2 ending in 2031”.

[HCWS1189]

Oral Answers to Questions

Chris McDonald Excerpts
Thursday 11th December 2025

(1 week, 2 days ago)

Commons Chamber
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Ruth Jones Portrait Ruth Jones (Newport West and Islwyn) (Lab)
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2. What assessment he has made of the potential impact of the industrial strategy on advanced manufacturing in south Wales.

Chris McDonald Portrait The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
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Our 10-year industrial strategy and sector plans will boost economic growth nationwide. South Wales is set to gain a new investment zone in Cardiff and Newport, targeting semiconductors and advanced manufacturing. Across Wales, manufacturers can benefit from a range of other industrial strategy measures that target lower energy costs, faster grid connections, and billions in new capital investments for small and medium-sized enterprises, making it easier to innovate, expand and thrive.

Ruth Jones Portrait Ruth Jones
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I welcome the Minister’s response and the additional support for the compound semiconductor cluster in my constituency. What conversations has he had with Welsh Government colleagues on delivering the joint objectives of the Welsh manufacturing action plan and the UK industrial strategy to attract additional investment and jobs to the Welsh semiconductor cluster?

Chris McDonald Portrait Chris McDonald
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I thank my hon. Friend for the work that she is doing to champion the Welsh semi- conductor cluster, which is so important for our entire advanced manufacturing sector. The Minister for artificial intelligence and online safety—the Under-Secretary of State for Science, Innovation and Technology, my hon. Friend the Member for Vale of Glamorgan (Kanishka Narayan)—was in Wales last week, meeting industry leaders and co-chairing the semiconductor advisory panel, and my right hon. Friend the Secretary of State for Business and Trade was recently at the Wales investment summit. We hope to attract many more investors to the compound semiconductor cluster in south Wales.

Elsie Blundell Portrait Mrs Elsie Blundell (Heywood and Middleton North) (Lab)
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3. What discussions he has had with Royal Mail on improving service levels in the north-west.

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Bill Esterson Portrait Bill Esterson (Sefton Central) (Lab)
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5. What steps his Department is taking to support businesses with energy costs.

Chris McDonald Portrait The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
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My hon. Friend, through his chairmanship of the Energy Security and Net Zero Committee, is working very hard to highlight the issues of business competitiveness and energy costs to businesses. I would draw his attention to the British industrial competitiveness scheme consultation, which I launched a couple of weeks ago, which is our commitment through the industrial strategy to reduce energy costs for over 7,000 manufacturing businesses by around £40 per megawatt-hour from 2027. I encourage all Members to ensure that manufacturing businesses in their constituencies respond to that consultation.

Bill Esterson Portrait Bill Esterson
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Reducing costs by £40 per megawatt-hour for 7,000 manufacturing businesses is welcome, as is the news in the Budget of changes to the British industry supercharger scheme. However, there are tens—if not hundreds—of thousands of other manufacturing businesses facing some of the highest electricity prices in Europe, which has been the case for many years. What is the plan to help the businesses facing very high bills right now while we wait for lower electricity bills in the longer term through Government plans for clean power?

Chris McDonald Portrait Chris McDonald
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My hon. Friend is right. Alongside the British industrial competitiveness scheme, we have also committed to increasing network charges compensation from 60% to 90% under the network charging compensation scheme. We are also reviewing our energy intensive industries compensation scheme. He is right to recognise the lack of competitiveness on energy prices between the UK and the rest of Europe—a terrible situation that was bequeathed to us by the previous Conservative Government and their ideological adherence to relying on foreign dictators such as Putin for Britain’s energy needs. We are investing in our future energy needs to ensure that they are clean, cheap and secure.

Lincoln Jopp Portrait Lincoln Jopp (Spelthorne) (Con)
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National Grid is going to spend about £30 billion by the end of the decade building pylons, but only 2% of the steel used to build those pylons will be British; similarly, in the offshore wind projects, only 2% of the steel will be British. That is because of carbon taxes and energy costs. Does the Minister recognise that rather than promoting the opportunity of the great, green revolution that they were espousing earlier, the Government are actually killing British business with high energy costs?

Chris McDonald Portrait Chris McDonald
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I do not believe the hon. Gentleman is correct to attribute that cause to carbon taxes or energy costs, but I share his concern about the lack of British steel and other British materials being used in construction projects funded by the taxpayer. I believe that the taxpayer expects materials for such projects to largely be sourced from the UK. That is why I had cause over the last couple of weeks to speak to British Petroleum about its use of Chinese steel in energy projects. I will continue to call in the chief executives of companies and discuss with them how we will increase British content in British projects.

Gareth Snell Portrait Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
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The UK ceramics sector is one of the most gas and electricity-intensive industries in the UK, so I make my usual plea to the Minister to consider changes to the supercharger scheme ahead of the British industrial competitiveness scheme coming online. Will he also give some thought to the electrification process? There are parts of the ceramics sector that would like to electrify, but the industrial grid capacity simply does not exist yet. What will the Government do to allow those companies to move forward with electrification, which ultimately will help to bring down their energy bills?

Chris McDonald Portrait Chris McDonald
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I thank my hon. Friend for his question and for the incredibly constructive Westminster Hall debate we had last week on the ceramics industry, which was supported by my hon. Friend and other Members representing ceramics constituencies around the Stoke and Staffordshire area.

I recognise my hon. Friend’s call for ceramics to be considered under the review of the supercharger scheme, and I have ensured that those calls have been heard within the Department. I want to ensure that ceramics is considered very carefully as part of that. I also appreciate the continued commitment of Ceramics UK, which I met with last week, and the rest of the ceramics industry to work together with me to see how we can improve the competitiveness of the industry.

Clive Jones Portrait Clive Jones (Wokingham) (LD)
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In Wokingham we are lucky to have 119 great hospitality businesses. Those businesses are struggling under the burden of rising energy costs, increases in national insurance and business rates and many other cost increases. The Liberal Democrats called for a 5% cut in VAT to help the hospitality sector, but the Chancellor ignored that proposal, which would have gone some way to help businesses cope with rising energy costs. What is the Minister doing to ease the concerns of business owners in Wokingham, who will be worried about their businesses?

Chris McDonald Portrait Chris McDonald
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The Government are, of course, very concerned about cost pressures on hospitality businesses. The Under-Secretary of State for Business and Trade, my hon. Friend the Member for East Renfrewshire (Blair McDougall) met with hospitality businesses just this week to discuss exactly that. The hon. Member raises the question of a reduction in value added tax, which would affect the whole industry, so it would be something of a blunt instrument. Instead, the Government are providing transitional support for those businesses, particularly on business rates. We continue to listen to and work with the sector.

Lindsay Hoyle Portrait Mr Speaker
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I call the Liberal Democrat spokesperson.

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Lindsay Hoyle Portrait Mr Speaker
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Order. One of us is going to have to sit down. Please, it is topicals and I have some Members who did not get in before you. You’ve got to help them, please.

Chris McDonald Portrait The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
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I thank my hon. Friend for her question, and for so kindly hosting me on a trip to Falmouth port, where I saw for myself the great potential in her constituency for critical minerals and floating offshore wind. I recognise the skills issue, and the Government are supporting the sector through the Government’s clean energy jobs plan and another £180 million for demonstration projects. She should be assured that I have raised the potential of Falmouth, particularly the extensive anchorage there, with both the National Wealth Fund and the Crown Estate.

Lindsay Hoyle Portrait Mr Speaker
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I call the shadow Secretary of State, Andrew Griffith.

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Matt Western Portrait Matt Western (Warwick and Leamington) (Lab)
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The UK-US economic prosperity deal was very welcome for the automotive sector, but there are some challenges for that sector. The current quota of 100,000 units and the quarterly thresholds are particularly difficult for small-volume and micro manufacturers, such as Aston Martin, McLaren and Morgan. What conversations are taking place between the US and the UK on those details?

Chris McDonald Portrait Chris McDonald
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I certainly recognise the issue of the quota, and the importance of our small-volume manufacturers such as Aston Martin and McLaren. I met McLaren last week, I had a meeting with Aston Martin this week as part of the Automotive Council UK, and I will meet Aston Martin’s chief executive in the new year. This is perhaps a good opportunity to congratulate McLaren and Lando Norris on his outstanding win at the Formula 1 championship—only 35 men have won the F1 championship, and 11 of them have been British. The motorsport industry is a fine example of British engineering and British sportsmanship coming together.

Jessica Morden Portrait Jessica Morden (Newport East) (Lab)
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Last week I met Community union representatives representing steelworkers across Wales, including in Llanwern— I draw attention to my entry in the Register of Members’ Financial Interests. They support the welcome movement on energy costs, and they know that the Government are working on procurement and that there will be a steel strategy, but the most urgent ask is on the EU’s steel import quotas and tariffs. Can the Minister please give us an update on those?

British Steel

Chris McDonald Excerpts
Wednesday 10th December 2025

(1 week, 3 days ago)

Written Statements
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Chris McDonald Portrait The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
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The Government committed to updating Parliament on British Steel every four sitting weeks for the duration of the period of special measures being applied under the Steel Industry (Special Measures) Act 2025.

The Government’s priority remains to maintain the safe operation of the blast furnaces at British Steel. Government officials are continuing to provide on-site support in Scunthorpe, ensuring uninterrupted domestic steel production and monitoring the use of taxpayer funds.

On funding, the position remains that all Government funding for British Steel will be drawn from existing budgets, within the spending envelope set out at spring statement 2025. To date, we have provided approximately £274 million for working capital, covering items such as raw materials, salaries, and addressing unpaid bills, including for SMEs in the supply chain. This will be reflected in the Department for Business and Trade’s accounts for 2025-26.

The impact assessment relating to the Act has been submitted and is currently awaiting review by the Regulatory Policy Committee. It will be published in due course following their scrutiny. We are also continuing work on the introduction of a compensation scheme for steel undertakings in scope of the Act.

We continue to work with Jingye to find a pragmatic, realistic solution for the future of British Steel. As we have stated previously, our long-term aspiration for the company will require co-investment with the private sector to enable modernisation and decarbonisation, safeguard taxpayers’ money and retain steelmaking in Scunthorpe. Once a solution is found, we will terminate the directions issued to British Steel under the Act and make a statement on the need to retain, or repeal, the legislation.

Steel strategy

The Government remain committed to supporting the UK steel sector and delivering a steel strategy. A robust position on trade is a critical element of this strategy, underpinning our approach to defending against unfair practices and global overcapacity. To protect our domestic sector, we are prioritising developing robust measures in the light of the UK steel safeguard expiring during 2026, making sure there are healthy levels of imports, and engaging with our partners. We will therefore publish the steel strategy in early 2026.

[HCWS1149]

Advanced Ceramics Industry: North Staffordshire

Chris McDonald Excerpts
Wednesday 3rd December 2025

(2 weeks, 3 days ago)

Westminster Hall
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.

Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.

This information is provided by Parallel Parliament and does not comprise part of the offical record

Chris McDonald Portrait The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
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It is a pleasure to serve under your chairmanship, Sir Jeremy. I am very grateful to my hon. Friend the Member for Stoke-on-Trent South (Dr Gardner) for securing this debate. She knows how much I care about the ceramics industry and how much I appreciate any opportunity to talk about ceramics. I am grateful we have had that opportunity today. Stoke-on-Trent and north Staffordshire have much to be proud of in their rich and diverse ceramics industry. Stoke-on-Trent is the historic home of the UK ceramics industry, but the sector spans so much of our country and is important to the lives of numerous communities.

I know that this year has been a difficult year for the ceramics industry. I was deeply saddened to learn of the closure of ceramics firms such as Royal Stafford and Moorcroft, as I am sure many of my colleagues were. I think not only of the loss of great brands and great capabilities, but of what it will mean to the workforce and the local community, who have taken such pride in their production of ceramics products from those factories over so many years.

Although ceramics encompass decorative and tableware, advanced ceramics are essential as well, as my hon. Friend the Member for Stoke-on-Trent South outlined. For Members who are not so familiar with the ceramics industry, they have the opportunity to go downstairs to the Westminster Hall fair and buy a very fine teapot from Moorlands, as I did earlier. It will replace a cracked teapot in the Department for Business and Trade of unknown origin—I have been informed that it may be from Turkey. I am very pleased that I will be able to replace it with a British teapot today.

Every time I drink my tea in the Department, I will be reminded of the ceramics industry in the UK, and every time anyone picks up their mobile phone, they could think about the advanced ceramics in it. As we have heard, advanced ceramics are also present in medical devices such as hip replacements and in the space industry. Advanced ceramics are providing essential components for defence, energy and our advanced technology industries. That includes companies such as Mantec, which produces advanced filter technology, as my hon. Friend mentioned.

As set out in the industrial strategy, ceramics, particularly advanced and technical ceramics, are a key input in the advanced manufacturing and clean energy sectors. I reiterate that ceramics is an essential sector, as was highlighted by my hon. Friend the Member for Stoke-on-Trent North (David Williams). The support that I will set out will help the sector to play a key role in kick-starting economic growth in the country, which is the central mission of this Government.

I commend my hon. Friend the Member for Stoke-on-Trent South on her continued advocacy and championing of the sector and on her vision of the establishment of a sovereign advanced ceramics manufacturing facility in north Staffordshire. In this geopolitically uncertain world, security of critical supply chains is essential, and I encourage her to continue the conversations that she is having with Innovate UK on that subject.

The Government understand that businesses face numerous challenges day to day, particularly the price of electricity. That is why we recently announced an uplift to the network charging compensation scheme from 60% to 90%.

Gareth Snell Portrait Gareth Snell
- Hansard - - - Excerpts

The Minister mentioned electricity prices. I have repeatedly asked the Government to consider the expansion of the supercharger scheme for current industrial use by the ceramics sector. That would be a massive help before the British industrial competitiveness scheme comes online. I know the Minister is going to outline a series of significant things that he believes the Government could do to support the ceramics sector. I encourage him to consider working with the APPG on a bespoke ceramics strategy that would be cross-departmental and cross-Government, so that the support that I know he desperately wants to offer us can be replicated across Government, so that when we have these debates in the future, we can talk about how we implement the help that we need rather than talk about the help we hope we can get.

Chris McDonald Portrait Chris McDonald
- Hansard - -

Although the compensation scheme I outlined is delivering £1.7 million to eight ceramics firms, I am acutely aware that it does not cover the vast majority of the sector. I met today with the chief executive of Ceramics UK. We discussed this issue and the fact that eligibility for the scheme is up for review in 2026. I have committed to working closely with him to see what opportunity there will be to extend the scheme to other ceramics firms and to ensure that the review takes every opportunity to see whether there is the potential for greater eligibility for ceramics firms. I am always happy to work with the APPG. Perhaps we can take my hon. Friend’s suggestion further and have further discussions about that.

Adam Jogee Portrait Adam Jogee
- Hansard - - - Excerpts

I want to add my voice to that of my constituency neighbour, my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell). A bespoke ceramics strategy would do wonders for our part of the world—in Newcastle-under-Lyme, in neighbouring Stoke-on-Trent and further afield into the east midlands. I want to reassure the Minister that a number of us would make that case, and make it strongly.

Chris McDonald Portrait Chris McDonald
- Hansard - -

I know that my hon. Friend will be familiar with the benefit that sector strategies have had in other areas through his work as the vice-chair of the international trade and investment all-party parliamentary group. I take his comments very seriously and will absolutely consider them.

Last week, we launched a consultation for the British industrial competitiveness scheme. That is an opportunity for many thousands more additional manufacturing businesses to benefit from reduced electricity prices. I encourage the ceramics industry to participate in the consultation for that scheme. The Government are committed to ensuring that our electricity price support schemes continue to be targeted, effective and proportionate, and represent value for money for the British taxpayer. However, we are not stopping there.

I recognise that many ceramics businesses do not benefit from our electricity price support schemes due to their gas-intensive nature. For some of those businesses, electrification is possible, although it will require capital investment. For other businesses, there are currently no electrification options. Through our engagement with trade bodies, trade unions and businesses, we are working to consider all possible options for how we can help ceramics businesses further. I look forward to working with my hon. Friend the Member for Stoke-on-Trent South and other hon. Members as we develop that work over the coming months.

Trade has benefited the UK, and we continue to go from strength to strength in negotiating trade deals. The Government are proud of the work that went into the India free trade agreement and the ongoing work on our free trade agreement with the Gulf Co-operation Council. The UK-India free trade agreement will see the immediate or staged removal of tariffs on ceramic exports to India, opening up access to India’s large and growing middle class for producers of consumer ceramics, as well as to India’s many infrastructure projects and manufacturing opportunities for UK businesses in the advanced ceramics sector.

The agreement will also include a comprehensive trade remedies chapter. That chapter, as well as reaffirming existing safeguard provisions, includes a bilateral safeguard mechanism that will allow the UK or India to temporarily increase tariffs or suspend tariff concessions if there is a surge of imports causing injury or threat of serious injury to domestic industry as a result of the tariff liberalisation set out in the agreement.

The UK has been negotiating a modern and ambitious free trade agreement with the Gulf Co-operation Council that will boost economic growth and increase investment in the UK. That deal will help to grow our economy and bring benefits to communities across the country.

Allison Gardner Portrait Dr Gardner
- Hansard - - - Excerpts

Do I take it from the Minister’s response that we will have some help to prevent china-dumping? GMB and great campaigners such as Sharon Yates have been campaigning to stop the huge foreign imports that are coming in and damaging our locally and British-made products.

Chris McDonald Portrait Chris McDonald
- Hansard - -

By elucidating the trade deal with India and the deal that we hope to strike with the Gulf Co-operation Council, I am hoping to outline the fact that there is not only a commitment to trade that will enable UK producers to access markets, but a commitment to fair trade. That is far easier done within the bounds of a free trade agreement where there are existing mechanisms in place. That is why our Department is working so hard to ensure that we get additional coverage of free trade agreements through various jurisdictions around the world.

Turning back to the Gulf Co-operation Council agreement, the UK is currently a net importer of ceramics from the Gulf states. Reducing UK tariffs has been identified as one of the GCC’s priorities. Our objective is to secure provisions that support competitiveness and growth across the UK while safeguarding UK manufacturing interests.

I understand that there is more work to be done to support our local ceramics firms that may be at risk from cheap imports from abroad. The standard response to this—I will give it and then qualify it, if that is acceptable—is to encourage ceramics companies to engage with the Trade Remedies Authority. However, I am aware of the significant burden that imposes in terms of cost and time, so I would encourage hon. Members who are in touch with ceramics companies in their areas—I will continue my engagement with Ceramics UK—to carefully monitor the ability of those companies to engage with the Trade Remedies Authority and to ensure that it is possible for their issues to be raised. If there are concerns about time and cost, I would appreciate it if they were raised with me directly.

Gareth Snell Portrait Gareth Snell
- Hansard - - - Excerpts

If the Minister is looking at the Trade Remedies Authority, perhaps he could also look at the lesser duty rule, under which a product imported from China or the EU would face a higher tariff under their remedies than it does in the UK, because we have deliberately set our system to apply the lesser duty rather than the injury duty. It is technical, but it would make a big difference if he could consider that.

Chris McDonald Portrait Chris McDonald
- Hansard - -

It is a very technical issue, and I have thought of little else since my hon. Friend explained it to me in great detail a few days ago. I will certainly commit to continuing to think about it, and I thank him for bringing it to my attention and placing it on the record.

Allison Gardner Portrait Dr Gardner
- Hansard - - - Excerpts

Regarding trade, exporting to the EU is particularly challenging, and I look forward to any trade deals we may see from there to help with that.

Chris McDonald Portrait Chris McDonald
- Hansard - -

Yes, I recognise that. Any further improvements in relation to our nearest and largest market would certainly be welcome.

Clearly, decarbonisation will require further innovation, and I commend industry and academia on the groundbreaking research they have conducted, which I know my hon. Friend has vigorously supported. I recognise the work of Lucideon; it is an organisation I know well, and it is indeed a world-leading developer of research and innovation for the ceramics sector. I also recognise the work of its AMRICC centre—the Applied Materials Research, Innovation and Commercialisation centre—and the Midlands Industrial Ceramics Group, which have benefited from direct grant support. My hon. Friend also asked about engagement with the National Wealth Fund. I will be happy for my office to provide contact details for a direct conversation to take place.

My hon. Friend made a point about increasing UK capability for defence. She and the ceramics industry may consider responding to a consultation launched by the Ministry of Defence on 23 October on its offset regime, which has the potential to ensure that we get greater investment in industries such as ceramics in our defence supply chains. The Government, particularly through UK Research and Innovation, work with and support such stakeholders to accelerate that kind of research and propel decarbonisation.

I agree with my hon. Friend the Member for North West Leicestershire (Amanda Hack) that it is important that we share innovation across multiple sectors. I am thinking particularly of the Foundation Industries Sustainability Consortium, for instance, which shows that there is great opportunity for furnace technology and so on to be shared across the foundation industries.

I very much echo the remarks of my hon. Friend the Member for Newcastle-under-Lyme (Adam Jogee) that north Staffordshire is well placed to attract further investment and to continue to go from strength to strength and become the UK centre for ceramics. In response to the specific request about attending a roundtable, I would be very happy to do that and to have further discussions with the industry. I believe I have a couple of engagements with the ceramics industry already in my diary in the period after Christmas, and I would be happy to attend a roundtable, either separately or as part of one of those events.

Adam Jogee Portrait Adam Jogee
- Hansard - - - Excerpts

I thank the Minister for acknowledging the points about Newcastle-under-Lyme and north Staffordshire. We are happy to host that meeting, so if he can let us know the best way to get it into the diary, we will get it done sooner rather than later.

Chris McDonald Portrait Chris McDonald
- Hansard - -

I thank my hon. Friend. Far be it from me to adjudicate between a bunch of Stokies as to where the meeting should be—I will leave that to hon. Members themselves to figure out—but I remain ready to travel to the area to take part in the meetings, or to host the meeting at the Department if that is preferred.

Whether it is decorative or tableware, bricks, tiles or pipes, advanced ceramics or sanitaryware—as has been raised with me so many times by my hon. Friend the Member for Lichfield (Dave Robertson)—or even refractories, probably the area I know best, advanced ceramics are essential for the delivery of our industrial strategy. I would be happy to work with hon. Members and the companies in their areas to ensure that the ceramics industry gets the best chance it can to continue to be a great British industry.

Question put and agreed to.

Contingent Liability Guarantee: SEFE

Chris McDonald Excerpts
Thursday 27th November 2025

(3 weeks, 2 days ago)

Written Statements
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Chris McDonald Portrait The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
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I wish to make Members aware of the details of a contingent liability guarantee, which will be entered into in favour of SEFE, in accordance with and pursuant to the Steel Industry (Special Measures) Act 2025, to support British Steel Ltd, and for the purpose of securing the continued and safe use of blast furnace operation in Scunthorpe.

The guarantee will replace the existing credit support, be of the same value, is a policy requirement for SEFE, and would be in respect of British Steel Ltd’s payment obligations to SEFE. Without such guarantee, SEFE would not extend the underlying supply contract with British Steel Ltd, leaving British Steel Ltd unable to access a key supply, or British Steel Ltd would only be able to do so on materially worse terms.

The terms of the guarantee ensure that the impact to the public purse is reduced. The guarantee may be terminated by the Department by providing SEFE with 10 business days’ written notice. The effective date of the guarantee is 31 March 2026.

Authority for any expenditure required under this liability will be sought through the normal procedure. I will lay a departmental minute before Parliament today, containing a description of the liability undertaken.

If, during the period of 14 parliamentary sitting days, a member signifies an objection by giving notice of a parliamentary question or by otherwise raising the matter in Parliament, final approval to proceed with incurring the liability will be withheld pending an examination of the objection.

[HCWS1102]

Business and Trade

Chris McDonald Excerpts
Tuesday 25th November 2025

(3 weeks, 4 days ago)

Written Corrections
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Chris McDonald Portrait Chris McDonald
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In Cornwall, we have Europe’s largest deposits of lithium, and in Devon, the world’s largest deposits of tungsten. The UK has the only Western source of rare earth alloys for F-35 fighter jets.

[Official Report, 24 November 2025; Vol. 776, c. 48.]

Written correction submitted by the Under-Secretary of State for Business and Trade, the hon. Member for Stockton North (Chris McDonald):

Chris McDonald Portrait Chris McDonald
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In Cornwall, we have Europe’s largest deposits of lithium, and in Devon, the world’s second largest deposits of tungsten. The UK has the only Western source of rare earth alloys for F-35 fighter jets.

Critical Minerals Strategy

Chris McDonald Excerpts
Monday 24th November 2025

(3 weeks, 5 days ago)

Commons Chamber
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Chris McDonald Portrait The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
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With permission, I would like to make a statement on the Government’s critical minerals strategy. Madam Deputy Speaker, I am particularly delighted that you are in the Chair, given your personal interest in critical minerals, having launched the UK’s first critical minerals strategy a number of years ago. I am also pleased to be joined on the Front Bench by my hon. Friend the Member for Croydon West (Sarah Jones), for whose work I aim to take the credit this evening.

The story of man is the story of metals. From the discovery of the first alloy—bronze, a mixture of copper and tin—people have smelted, melted, forged and formed metals to their will. Knowledge of the art of blending alloys has been sought throughout history by kings and nations for defence and prosperity. The ancients recognised the noble metals of gold and silver, and the base metals of tin, lead, copper and iron. The industrial revolution led to the industrial metals of steel, aluminium and titanium, but our age is to be dominated by critical minerals—the basic materials that give function to everything from digital technology to fusion energy. That is why we have launched our new Vision 2035, the UK’s critical minerals strategy. It is part of our industrial strategy and supports the Government’s No. 1 mission—the mission for growth. Whether it is neodymium for permanent magnets, platinum for fuel cells or copper for infrastructure, our critical minerals strategy will ensure that the UK can access these vital materials, and that we all benefit from the security and economic opportunities they offer.

The UK is already home to one of the largest nickel refineries in Europe at Clydach, and a rare example of European cobalt refining at Widnes. We have titanium production in Swansea, aluminium at Fort William, chromium in Rotherham, platinum group metals and vanadium, all with the highest standards of environmental control. In Cornwall, we have Europe’s largest deposits of lithium, and in Devon, the world’s largest deposits of tungsten. The UK has the only western source of rare earth alloys for F-35 fighter jets.[Official Report, 25 November 2025; Vol. 776, c. 4WC.] (Correction) To quote my right hon. Friend the Chancellor of the Exchequer,

“where things are made…matters.”—[Official Report, 11 June 2025; Vol. 768, c. 979.]

We have world-leading academic institutions. The University of Birmingham is commercialising a process for pulverising magnets into a powder for remanufacturing. Queen’s University Belfast is developing magnet recycling technologies, using ionic liquids to recover rare earth metals. Camborne SCHOOL OF MINES has remained a leading British institution for over a century, and I am looking forward to visiting tomorrow.

Having spent much of my career in metals research, I know that as a country we underestimate the global standing of our institutions, but of course the point of research is to create value for the UK economy, which means commercialisation at home. In Britain, we understand the advantage that can be created by a global dominance in metals. For centuries, half of the world’s tin came from Cornwall and Devon. Britain dominated the graphite industry thanks to the Borrowdale deposits in Cumbria. Almost all the world’s copper was smelted in Swansea and the majority of global steel production came from Sheffield. As a nation, we confidently built a global competitive advantage from ingenuity alone, taking action to shape the world around us. Now, we have the opportunity to confidently do so again. By combining our natural mineral deposits, secondary resources from recycling, strength in midstream processing, innovation, and a role as the global centre for finance and trading, we will ensure that by 2035 at least 10% of annual UK demand is met from domestic production and 20% from recycling. This displacement of imports by the development of both primary and secondary recycling routes is driven by a need to enhance our economic security.

The deployment of this strategy will ensure that our capabilities are marshalled and supported appropriately, our supply chain opportunities are identified, and that resources, both public and private, are targeted at strengthening the UKs competitive position. Our industrial strategy is a deliberate partnership between Government and private investment, and this is also the case on critical minerals. Up to £50 million of new Government funding for domestic production will take total funding to over £200 million. The City of London is already a global centre for the listing of mining companies and mining finance. With the London Metal Exchange as the global hub for metals trading, and ICE Futures Europe expanding into critical minerals, our opportunity is to redirect our financial and investment strength into UK industrial development. 

Significant investment support is available from UK Export Finance and the National Wealth Fund. That will reduce the need for UK entrepreneurs to sell their companies to overseas investors at an early stage, and increase the opportunity for Britain to benefit from the growth of new UK-owned, UK-headquartered and UK-listed industrial champions. 

Our British industrial competitiveness scheme, the consultation on which was announced in a written statement laid before the House today, will improve the competitiveness of the business environment. It will reduce electricity costs by up to £40 per megawatt-hour from April 2027 for over 7,000 eligible manufacturing businesses, reducing their energy bills by 25%. 

Having identified our critical mineral needs and domestic capabilities, and as we now take action to secure investment, we must make sure that our policies on trade and international co-operation ensure diversity of supply and safeguard our nascent industries. As well as exploiting our natural primary and secondary sources of critical minerals, we will diversify international supply chains, so that by 2035, no more than 60% of any critical mineral will come from a single country. We will achieve this by ensuring that future trade agreements allow increased access to critical mineral supply chains, and by entering into bilaterial agreements that increase the breadth of our supply base. We will work through organisations such as the G20, G7, the World Trade Organisation, NATO and the International Energy Agency to improve supply chain resilience.

In June, the Prime Minister announced the largest sustained increase in defence spending since the end of the cold war, and for the sake of national security, we are considering mandating that stockpiles be held by industry, using procurement to create diversity in the supply chain, and taking part in the NATO critical minerals stockpiling project. Our trade strategy includes a strengthened approach to trade defence, ensuring that we can safeguard UK businesses from an increasingly volatile international trading environment. That will involve us introducing new legislation to expand our powers to raise tariffs in response to unfair trading practices.

This Government are not agnostic on the fate of British industry and British manufacturing. Given a fair business environment, our industry and workers can out-compete others. The industrial capability of Britain should not be subject to the whims of the international market or foreign Governments. Our industrial strategy, and the place of critical minerals within it, is a marked departure from the hands-off approach of the past. The UK Government is now working in close partnership with UK industry to support private sector investment and growth, just as other developed economies have done and continue to do. The new critical minerals strategy is another step forward in that ambition, and gives business investors confidence that the materials, industry and jobs for Britain’s future are secured. Critical minerals are essential for building the modern world. Control and supply of these materials are the means by which nations will secure power and wealth in this century. I commend this statement to the House.

Nusrat Ghani Portrait Madam Deputy Speaker (Ms Nusrat Ghani)
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I will definitely be paying close attention. I call the shadow Minister.

Harriett Baldwin Portrait Dame Harriett Baldwin (West Worcestershire) (Con)
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I thank the Minister for advance sight of his statement. Critical minerals are vital to our national security. In submarines, missiles, jet fighters and radar, we need critical minerals for our national defence. Critical minerals in electric vehicles and wind turbines are also vital for clean energy generation.

It is striking, however, that the Government’s critical minerals strategy does not mention China once. That is despite that fact that China, which has built an almost global monopoly on processing, recently imposed export licence requirements on seven rare earth elements: samarium, gadolinium, terbium, dysprosium, lutetium, scandium and yttrium. Can the Minister say whether the Department has made any assessment of China’s dominance in the critical minerals market and whether the Government consider it a threat?

The UK “Critical Minerals Strategy” document seems to have been written in a bit of a rush. It is sloppy, riddled with spelling mistakes and has inconsistent statistics and errors in geography. Why should industry trust a Government who cannot even proofread? For instance, according to the Cobalt Institute, current global demand is 200,000 tonnes and is set to grow by 14% a year, meaning that by 2030, the global demand for cobalt is forecast to be 438,000 tonnes. In the Government’s document, however, UK domestic demand will be 636,000 tonnes in 2030. Could the Minister kindly proofread the document and place a corrected version of the whole strategy in the Library?

The strategy recognises the impact that high energy prices have had on the critical minerals industry, but under Labour, our energy bills are up. Why do the Government not just adopt our cheap power plan to cut electricity bills by 20%? Oil and gas are key inputs in the production of critical minerals. What impact does the Minister believe this Government’s policy of closing down the North sea will have on domestic critical minerals production?

Under Labour, foreign direct investment into this country has fallen to an all-time low. How do the Government expect to build a critical minerals industry if no one is investing? Can the Minister therefore today rule out any tax rises heading towards this industry on Wednesday? The national insurance jobs tax and the unemployment Bill are set to cost the critical minerals industry £50 million, which is exactly the same figure as the funding pledged by the Government today—the Chancellor’s jobs tax and the 330-page job-killing Employment Rights Bill are costing businesses £1,000 per worker, and there are a total of 50,000 people employed in the critical minerals industry. Is this a recognition from the Minister that the Government’s tax rises are crippling British industry?

In summary, the first duty of any Government is to keep our country safe. Refreshing the critical minerals strategy is an essential part of that mission. Given the scale of global competition and the risks of supply chain disruption, does the Minister agree that there is still a great deal of work to do to ensure that Britain is secure in the critical minerals we need for our future?

Chris McDonald Portrait Chris McDonald
- Hansard - -

I start by saying that if there are indeed any spelling or factual errors in the document, I offer my apologies to the House; that is clearly unacceptable, and I will ensure that any corrections are made and that a new copy is laid before the House. I thank the hon. Lady for bringing those matters to my attention.

On the substantive issues raised by the shadow spokesperson, the point about China is clearly very important. The Government are well aware of China’s dominance of critical minerals supply chains. In some areas—particularly in processing, as she will be aware—China controls 70% to 90% of the market. Our critical minerals strategy is designed precisely to provide greater diversity of supply, both at home, through primary and secondary extraction where we have the materials to do that, and through our G7, G20, NATO partners and others, as I mentioned in my statement. A critical point to note is that the supply of secondary raw materials is a natural resource that the UK has. We currently offer those resources for processing overseas, which are then returned to the UK at considerable cost. A focus of this strategy is ensuring that we have those resources in the UK.

The shadow spokesperson mentions electricity bills. I think that my statement is best read in conjunction with the written statement on the British industrial competitiveness scheme, which aims to reduce electricity bills for industry by 25% compared with current levels—a reduction of £40 per MWh. The British industrial competitiveness scheme and the critical minerals strategy are both part of this Government’s relentless focus on growth and our success in attracting inward investment.

As to the points about taxation, I am afraid that the hon. Lady will have to wait 48 hours for the Budget.

Perran Moon Portrait Perran Moon (Camborne and Redruth) (Lab)
- Hansard - - - Excerpts

Meur ras, Madam Deputy Speaker. Anyone who has visited my Camborne, Redruth and Hayle constituency cannot have missed the signs of our industrial past, but after decades of post-industrial deprivation, global demand for critical minerals is surging to accelerate the transition to a clean energy future—opposed entirely by Reform—and with our unique geology, Cornwall is at the epicentre of the opportunity. The geology has not changed, but the market is back with a Government who get it. This Labour Government have published a strategy with teeth, with targets for domestic production, a new growth minerals list and £50 million in funding. Does the Minister agree that investment must flow into Cornwall to create jobs, reduce the reliance on China that was allowed to run rampant under the Conservatives and, in so doing, unleash the Cornish Celtic tiger?

Chris McDonald Portrait Chris McDonald
- Hansard - -

Meur ras to my hon. Friend. He has been such a strong champion of critical minerals, so it is a pleasure to hear from him today, and it is no wonder that we have, given that Camborne and Redruth is already home to the Crofty tin mine and has great opportunities for lithium extraction as well, holding Europe’s largest deposit of lithium. I believe that this will mark the launch of a renaissance in the mining industry in Cornwall—an industry that has so much to bring to Cornwall and that the Cornish people love so well for the jobs it brings and the pride it gives to communities too. All the work in this strategy would simply not have been possible without the support of my hon. Friend and his fellow MPs from Cornwall. I look forward to finding out more about the opportunities in Cornwall when I visit tomorrow.

Nusrat Ghani Portrait Madam Deputy Speaker (Ms Nusrat Ghani)
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I call the Liberal Democrat spokesperson.

--- Later in debate ---
Chris McDonald Portrait Chris McDonald
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I thank the hon. Lady for her words on the strategy. Words are one thing, but implementation is another. This Government are now focused on how we implement the strategy and ensure that we attract investment. The single biggest difference with this Government is that we are putting real money behind the strategy; as I mentioned, we are putting in an additional £50 million, bringing the total funding to £200 million. Through both the British Business Bank and the National Wealth Fund, there are opportunities for more significant investment to ensure that we have UK-headquartered, UK-owned and UK-listed industrial champions in this area. We are not agnostic about industry and manufacturing, and we want to ensure that the communities that host these businesses benefit from that and that the UK economy benefits as a whole.

Jayne Kirkham Portrait Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)
- Hansard - - - Excerpts

I am so pleased that the riches beneath our feet in Cornwall will finally be taken out and used in a sustainable way that benefits the people of Cornwall. I am so pleased to see this strategy, as are the people of Cornwall. The Minister is coming to Cornwall and will visit the port in Falmouth, which I hope will benefit from an expansion project. I am also hopeful to see the freight railway restored, which could be used in future to move critical minerals and supplies around in a more sustainable way and take lorries off the road. Will the Minister consider this tomorrow when he comes to Cornwall and as part of the strategy going forward?

Chris McDonald Portrait Chris McDonald
- Hansard - -

I thank my hon. Friend for the significant amount of work she has done and her engagement with me during the preparation of this strategy. She is right to highlight the opportunities at the port of Falmouth. Those opportunities start with critical minerals and perhaps also renewable energy. I intend to visit the port of Falmouth tomorrow and would be pleased to hear more about those opportunities when I am there.

Andrew Murrison Portrait Dr Andrew Murrison (South West Wiltshire) (Con)
- Hansard - - - Excerpts

This country has no phosphates, and no phosphates means no agriculture. Happily, our close friend and ally the Kingdom of Morocco has most of the world’s reserves of phosphates, but it is closely followed by unreliable countries such as Russia, China, Syria and Algeria. Does the Minister’s 60% rule apply to phosphates? Will he ensure that the association agreement signed between the UK and Morocco in 2019 is strengthened further so that we can ensure that we do have access to phosphates, without which our farming sector would be completely finished?

Chris McDonald Portrait Chris McDonald
- Hansard - -

I thank the right hon. Member for mentioning phosphates, which he is right are an incredibly important element for agriculture. As for securing supplies, I point him to the part of the strategy that talks about bilateral arrangements with nations to ensure that we get that diversity of supply. We are committed to working through multilateral organisations as well as ensuring that we get bilateral agreements in place with countries with mineral wealth that will be of benefit to the UK and where the relationship can be mutually supportive.

Anna Gelderd Portrait Anna Gelderd (South East Cornwall) (Lab)
- Hansard - - - Excerpts

Cornwall has a proud history of mining, and this announcement means that we will also lead the way in meeting the UK’s future demand for critical minerals, so I warmly welcome the Minister’s statement. The Government’s plan will create opportunities for businesses in South East Cornwall such as Cornwall Resources—my constituents thank the Minister for that—including year-round skilled jobs, strong local supply chains and investment that will keep local talent in Cornwall. Will he outline how the Government will ensure that that investment is supported by a clear skills plan so that local people can access the new jobs linked to critical industry and how communities will be involved throughout the exciting months ahead?

Chris McDonald Portrait Chris McDonald
- Hansard - -

I thank my hon. Friend for raising skills and for continually championing industry in Cornwall and skills with me for some time. The existing skills of the people of Cornwall are clearly one of the reasons why these industries will be so successful in Cornwall, but the Government also recognise that more investment in skills is required to ensure that so many viable projects in Cornwall can be successful. I assure her that the Department for Business and Trade is working with the Department for Work and Pensions on this issue. We are determined to ensure that all the people of Cornwall have the opportunity to participate in these industries.

Julian Lewis Portrait Sir Julian Lewis (New Forest East) (Con)
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Will the Minister tell the House what is so special about the year 2035? It is the year by which the Government say they will achieve expenditure of 3.5% of GDP on defence—compared with the 4.5% to 5% we used to spend in the cold war years of the 1980s—and it is now the year by which that the Government say no more than 60% of any critical mineral will come from a single country. Do the Government not feel that the deterioration of international relationships is such that we ought to be thinking about a rather closer timescale than 10 years from now?

Chris McDonald Portrait Chris McDonald
- Hansard - -

I do not know about the right hon. Gentleman, but when I am setting objectives, I like them to be specific, measurable and achievable. We have worked carefully with industry on the 2035 target, and projects such as those I mentioned in Cornwall clearly have mobilisation periods. He may be right to point out the synergy between the 2035 date of our critical minerals strategy and of our defence strategy, given that they are so closely linked.

Noah Law Portrait Noah Law (St Austell and Newquay) (Lab)
- Hansard - - - Excerpts

As chairman of the all-party parliamentary group on critical minerals, I greatly welcome the strategy released this weekend. Domestic supplies of critical minerals are of huge importance to our economic security and resilience in an ever more turbulent world. They are also a potential source of jobs and prosperity, particularly in places like mid-Cornwall, which, like the Minister’s own home, were once rich with the spoils of industry and can be once again. May I welcome the Minister meeting Cornish industry, Cornish workers and our supply chain businesses to agree how we ensure that the spoils of the industry cascade through every level of the local workforce, supply chains and even local ownership?

Chris McDonald Portrait Chris McDonald
- Hansard - -

I thank my hon. Friend for his work on the all-party parliamentary group on critical minerals and for working with the Critical Minerals Association; their work in advance of this strategy was incredibly helpful. He speaks well in championing his area in Cornwall, where there are projects involving Cornish Lithium and British Lithium. I can assure him that I will meet both those companies and speak to the management and the workforce when I am in Cornwall tomorrow.

Martin Wrigley Portrait Martin Wrigley (Newton Abbot) (LD)
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I welcome the ambition and importance of this new strategy, and I congratulate the Minister on recognising that Devon is the source of more than just cream teas and tourism. The Devon minerals plan has more in it than the critical minerals: my constituency has an application for an extension to dig up Zitherixon ball clay, a substance found in the middle of the town of Kingsteignton and in the war zone in Ukraine.

May I have the Minister’s assurance that, although we have a justified urge to get these minerals out, we will not abandon the environmental and residential concerns of our constituents in the areas impacted? Does he also acknowledge that transport is important and that Devon needs the Dawlish rail line to support these minerals?

Nusrat Ghani Portrait Madam Deputy Speaker (Ms Nusrat Ghani)
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Please keep questions short. They are not speeches.

Chris McDonald Portrait Chris McDonald
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I thank the hon. Member for his comments and for pointing out the importance of Durham—sorry, Devon! Durham is slightly on my mind; it is my home county. I think we may come to Durham later session.

On his prime point about the environmental aspect of mining for these minerals in Devon, I mentioned in my statement that the UK project will be held to the highest environmental standards. I specifically wrote those words into the speech because we need to take into account, when assessing the sources of critical minerals, that great environmental harm is caused in many places in the world by their extraction and processing. The processing in particular presents an economic opportunity for the UK, but there is also an environmental responsibility that we need to face up to. It is incumbent on us to find a way to do this processing economically in the UK so that environmental harms are not caused anywhere else in the world.

Justin Madders Portrait Justin Madders (Ellesmere Port and Bromborough) (Lab)
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I welcome the statement from the Minister and refer him to the Select Committee’s report issued today on economic security, which touches on some of the issues that he has talked about. It also talks about the much wider threats to the resilience of the UK’s economy. On that point, I want to ask him about stockpiling. The statement refers to the potential for some stockpiling to take place in the defence industry, but having seen the many threats to our national security identified by the Select Committee, will he consider expanding the scope of stockpiling to other critical minerals? There is real potential for industries to be completely crippled if hostile actors wanted to take us down that route.

Chris McDonald Portrait Chris McDonald
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I thank my hon. Friend for his question and for his work as part of the ministerial team in the Department for Business and Trade prior to my appointment. On stockpiling, it is the Government’s view that we will work with the Ministry of Defence and with industry and, while not mandating stockpiling, use procurement to ensure that we can stockpile appropriately. I certainly think that the precise quantity and breadth of the minerals to be stockpiled is something the Ministry of Defence will want to look at much more carefully. I know that my hon. Friend has also been a great champion for Less Common Metals, a great British champion in this space in his constituency. I spoke to the chief executive of that business just last week, and it has been central to forming the strategy.

Andrew George Portrait Andrew George (St Ives) (LD)
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I congratulate my hon. Friends on the Minister’s side of the House and endorse everything that they have said on this issue.

As the Minister will be aware, Cornwall has its own industrial strategy, which harmonises with the Government’s ambition and includes the space sector, green energy and geothermal. Will he ensure that the Government back the Cornish industrial strategy so that we can crack on with delivering the critical minerals strategy, and indeed all other aspects of the Cornish industrial strategy?

Chris McDonald Portrait Chris McDonald
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The hon. Member makes a good point in that, ultimately, the delivery of any modern industrial strategy is fully dependent on critical minerals. The sectors he mentioned, such as space, are entirely dependent on critical minerals. I doubt that there has ever been a strategy presented in this House that has more fulsome backing of Cornwall than this one.

Calvin Bailey Portrait Mr Calvin Bailey (Leyton and Wanstead) (Lab)
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The Defence Committee has been conducting a review of the AUKUS submarine programme and has recently published its review on European defence security. Secure critical minerals are central to both. Will the Minister explain how the strategy supports our national security strategy and the delivery of major defence programmes, such as the global combat air programme, the lightweight multirole missile, the new Typhoon radar and the new frigates?

Chris McDonald Portrait Chris McDonald
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My hon. and gallant Friend is right to raise the issue of AUKUS. I omitted AUKUS from the long list of international collaborations in my speech, but of course, there is an important role for AUKUS here through co-ordination between the nations involved. Our procurement reforms with the MOD will involve a supply chain centre where we will work with such international partners. He is also right to point out the economic opportunity through the export orders that the UK has recently secured. Having a supply chain of critical minerals in the UK will help the security of those exports.

Sammy Wilson Portrait Sammy Wilson (East Antrim) (DUP)
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Anyone listening to this statement should be fearful for the future of energy production in this country. On the one hand, we have a Government who are totally committed to net zero, the elements of which will require huge inputs of critical minerals. On the other hand, the Minister tells us that by 2035 we cannot expect to supply more than 10% by ourselves and will still be reliant on some other countries for 60%. We have no control, or no political control, over the global distribution of those metals. Does he not accept that this strategy, rather than being one of assurance for the future, could leave us increasingly vulnerable to people who have control over materials that we need for energy production, and that we should not be turning our back on the gas and oil we have?

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Chris McDonald Portrait Chris McDonald
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I thank the right hon. Gentleman for giving me the opportunity to clarify one point. He has formed the impression from my words, and I apologise if I was not clear, that we would supply only 10% from UK production. It is actually 10% from primary sources—that is, from mineral extraction—and a further 20% from recycling, so it is 30% in total from UK production. He talked about the green energy industries. Of course, these critical minerals are essential for many other industries, such as defence, space and artificial intelligence. In fact, I know how concerned he is about industries like oil and gas—they are essential for those industries, too.

Nusrat Ghani Portrait Madam Deputy Speaker (Ms Nusrat Ghani)
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I ask colleagues to keep their questions short.

Bill Esterson Portrait Bill Esterson (Sefton Central) (Lab)
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The Energy Security and Net Zero Committee has heard evidence that we need these critical minerals for our energy future. That is absolutely true, so the 10% from production and the 20% from recycling are key steps along that road. Can I ask the Minister about no more than 60% coming from one country? He talked about some of the allies he will work with, but what will this Government do to ensure that production is increased from countries other than those such as China?

Chris McDonald Portrait Chris McDonald
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My hon. Friend asks from where the remaining 70% of the UK’s critical minerals will be sourced. Of course, for some of those critical minerals, the UK will be able to produce more than our own domestic needs, and that enables us to enter into trading arrangements. I have already met my opposite number in the Canadian Government. Canada, of course, has extremely rich resources in this area, and the US is also very active. I mentioned some of the multinational organisations we are working through, not least NATO. It is through those arrangements and through trading arrangements with such nations that we will ensure diversity of resources where we do not have those resources ourselves in the UK.

Richard Foord Portrait Richard Foord (Honiton and Sidmouth) (LD)
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The Minister mentioned that Devon is home to the world’s largest deposits of tungsten. Tungsten is used in medical devices, robotics and defence applications, yet 80% of global demand for tungsten is being met by China. Will any of the £250 million that the Government have announced in their defence growth deal go towards tungsten mining in Devon?

Chris McDonald Portrait Chris McDonald
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We are determined to ensure that we exploit all the natural resources I mentioned that are available in the UK. The hon. Gentleman mentioned China’s strong grip on the processing of minerals, and that goes back to my earlier point about processing. It is one issue to get the raw materials from primary or secondary sources, but we also need to ensure that we attract investment in the UK for processing, too. There is certainly an opportunity for processing to be co-located alongside the natural resources in Devon, if that were considered a beneficial economic opportunity.

Clive Efford Portrait Clive Efford (Eltham and Chislehurst) (Lab)
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I welcome my hon. Friend’s statement, but he will be aware of the widespread concern about the impact of the deep-sea mining of critical minerals, which devastates an ecosystem that we know very little about. I acknowledge that he may not have the answer now, but will he undertake to write to me to say what the Government could do to ensure that we do not encourage deep-sea mining by allowing it into our future strategy?

Chris McDonald Portrait Chris McDonald
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I can assure my hon. Friend that the Government are extremely concerned about the ecological impact of deep-sea mining. The Government support a moratorium on—I choose my words carefully here—the exploitation of deep-sea mining, while allowing for the exploration of deep-sea mining. As a scientist and engineer myself, I think that the exploration is valuable, to ensure that we gather appropriate data, and I recently commissioned work from the chief scientific adviser in my Department to be fully appraised of the potential environmental impacts of deep-sea mining.

Jim Shannon Portrait Jim Shannon (Strangford) (DUP)
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I thank the Minister very much for his positive statement. It is great that the Government’s critical minerals strategy aims to reduce our over-reliance on foreign suppliers and to build a more resilient domestic supply chain, which is central to our growth sectors and to clean energy. He referred to the critical and important role of Queen’s University Belfast in magnet-recycling technologies. What steps have been taken to ensure good collaboration with the devolved Governments, to unlock further incentives for extraction projects, and to support domestic improvements through our minerals strategy?

Chris McDonald Portrait Chris McDonald
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The hon. Gentleman is right to point out that the critical minerals strategy will benefit every nation in the UK, including Northern Ireland. I am particularly keen to learn more about the ionic liquid separation methods of Ionic Technologies, which has been a flagship project for Queen’s University Belfast. I wrote to the relevant Ministers in the devolved Governments before the launch of the strategy, and I am keen to continue working with them on it.

Luke Myer Portrait Luke Myer (Middlesbrough South and East Cleveland) (Lab)
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I welcome the Government’s critical minerals strategy, but I wish the great British export of polyhalite had been included and given the recognition that it deserves as a critical mineral. As Teesside is a region with great critical mineral strength, how will the strategy benefit it and the wider supply chain?

Chris McDonald Portrait Chris McDonald
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My hon. Friend is right to highlight the polyhalite mines. There is the Whitby mine, of course, and I went down the Boulby mine myself some years ago. They are quite remarkable and a great natural mineral strength for the UK. Two projects—Tees Valley Lithium and Green Lithium—are considering sites in the Teesside area, and we hope that they will be operational soon. They are certainly positioning Teesside to continue in its strength as a processing centre for critical minerals in the UK.

Luke Akehurst Portrait Luke Akehurst (North Durham) (Lab)
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Does the Minister agree that, in an increasingly uncertain world, ramping up our domestic critical mineral production and diversifying our supply is critical to the defence of our country?

Chris McDonald Portrait Chris McDonald
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I could not agree more with my hon. Friend. There is an intrinsic link between the availability of critical minerals and the surety of defence, which is why so many countries are concerned about this. It is also why I am determined to ensure that British businesses are invested in and grow in the UK so that we have the supply of critical minerals that we need.

Tom Hayes Portrait Tom Hayes (Bournemouth East) (Lab)
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I welcome the strategy for all that it will do to tackle China’s stranglehold on critical minerals. It will sit alongside the Government’s efforts to build home-grown clean energy to get off the Russia-dominated fossil fuel market, and our work to ramp up the domestic production of defence capabilities to keep the Russian menace at bay. That stands in stark contrast to Reform, whose leader in Wales, Nathan Gill, has just been jailed for 10 years for betraying our country and accepting bribes for pushing out pro-Putin propaganda. Does the Minister agree that we can all feel safer when our essentials are made in Britain?

Chris McDonald Portrait Chris McDonald
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I agree that the security of the nation is very much dependent on the availability of these critical minerals. I hope that when people go to the ballot box, they think about the security of this nation and whether parties such as Reform can be trusted when they have senior people taking bribes from overseas Governments.

Sureena Brackenridge Portrait Mrs Sureena Brackenridge (Wolverhampton North East) (Lab)
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Critical minerals underpin everyday life and are essential from national security to the electronic gadgets we all rely on. Will the Minister say how the critical minerals strategy will ensure that UK businesses benefit while securing resilient supply chains?

Chris McDonald Portrait Chris McDonald
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Clearly the strategy will help UK businesses to benefit, but in my hon. Friend’s constituency, Wolverhampton North East, Recyclus Group is already operating a state-of-the-art plant that makes full use of waterless, low-emission processes to recycle lithium-ion batteries. I am sure we will see many such technologies to make use of end-of-life batteries from electric vehicles.

Jonathan Brash Portrait Mr Jonathan Brash (Hartlepool) (Lab)
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I welcome the statement from the Minister, who is of course my constituency neighbour. He knows full well that we represent areas that built this country and were far too often left behind by the last Government, by globalisation and by deindustrialisation. Can he assure me that this strategy and our wider industrial strategy will benefit those areas, like Teesside and Hartlepool, that did so much to build this country?

Chris McDonald Portrait Chris McDonald
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We already have projects for lithium recycling coming forward in Teesside that will benefit my hon. Friend’s constituents in Hartlepool. More than that, investments in nuclear power, the life extension of the existing power station, and small modular reactors in his constituency will all require critical minerals. He is right: the people of Hartlepool did build the UK and, more than that, they are now also the entrepreneurs leading some of these new critical minerals companies.

Graham Stringer Portrait Graham Stringer (Blackley and Middleton South) (Lab)
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I respect my hon. Friend’s optimism and his detailed technical knowledge of this issue. I suspect it is going to be very tough getting the supply lines as secure as he wants them to be, but does he also recognise that there is an absolute magnitude problem? I am sure he has read the book “Material World”, in which the writer, Ed Conway, points out that in the next 22 years we will need an amount of copper equivalent to what has been mined over the last 5,000 years. Is my hon. Friend aware of that and is it part of the strategy?

Chris McDonald Portrait Chris McDonald
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I am delighted that my hon. Friend has raised the issue of copper; I raised it nearly 10 years ago. Copper was not included in previous strategies because it was not regarded as a critical mineral. I am pleased to say that the new strategy creates a new category of growth minerals: minerals that do not fit the definition of critical minerals but are important for the future, and which we need in order to grow. The recycling and secondary refining aspect is also a priority for me; all of our copper is currently extracted and taken overseas for smelting and refining, but there is a good opportunity for us to do that in the UK.

Gareth Snell Portrait Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
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The Minister talks about things that are smelted, melted, forged and formed, and he will know that ceramics are crucial to those processes. He will also know that to deliver his ambitions for growth and recovery, and for virgin production, there will need to be an expansion of those processes. Is he having conversations with British Ceramics about how we can get refractory level ceramics in a better position to compete? Today’s announcement of the British industrial competitiveness scheme mentions foundational industries with a “certain threshold” of electrical usage. He will know that the processes he needs to get the strategy that he wants require gas, so are conversations happening about how the gas prices will underpin this strategy as well?

Chris McDonald Portrait Chris McDonald
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My hon. Friend correctly points out the essential role of ceramic refractories in the production of any high temperature processes, including critical minerals. I would be very happy to meet him later this evening to discuss both issues further.

Allison Gardner Portrait Dr Allison Gardner (Stoke-on-Trent South) (Lab)
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Advanced ceramics companies such as Mantec in my constituency produce ceramic membrane filters that are capable of extracting critical minerals including from industrial waste, improving productivity and recycling, reducing environmental pollution and of course reducing costs. Can the Minister tell me how UK businesses in the critical minerals supply chain, including innovators like Mantec, can benefit from the strategy through our strong public finance offers, including the National Wealth Fund and UK Export Finance?

Chris McDonald Portrait Chris McDonald
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Businesses with the kinds of technologies my hon. Friend mentions—separation technologies—can, as she said, access funding via the British Business Bank and the National Wealth Fund, and also the additional £50 million that we have made available. If it is a very early stage technology, I would encourage the business to have discussions with one of the Catapult centres or local universities and to consider an Innovate UK grant.

Sam Rushworth Portrait Sam Rushworth (Bishop Auckland) (Lab)
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I was delighted to see the prominence given to County Durham in the strategy, as Weardale, which I represent, has the highest density of lithium currently known in the UK. Will the Minister support me in working with the businesses in Weardale that are trying to extract lithium? Does he agree that we should not look only at extraction—we fall behind not only in the supply of critical minerals, but in their processing—and that there is a real opportunity to develop battery manufacturing in County Durham?

Chris McDonald Portrait Chris McDonald
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My hon. Friend is right to point to the opportunity in Weardale, which is currently being investigated by Weardale Lithium. I do hope that the company is successful in the extraction of lithium. Of course, as he says, there is an opportunity for processing as well. The strategy identifies two major areas of activity: in Cornwall, and in County Durham in the north-east of England. That is not a new arrangement—the village I grew up in had a sinkers’ row for Cornish tin miners who came to sink mines in County Durham and I am sure that most people in County Durham have Cornish genes—and the strategy provides a great opportunity for industrial collaboration between these two great regions of the country.

Alison Hume Portrait Alison Hume (Scarborough and Whitby) (Lab)
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Boulby mine is the world’s only polyhalite mine, but Woodsmith mine near Whitby is hoping to be the second. Polyhalite is a rare mineral that is used as a super-fertiliser. Will the Minister confirm that polyhalite, which contains magnesium, is eligible for support under the new strategy?

Chris McDonald Portrait Chris McDonald
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My hon. Friend is right to point out the importance of polyhalite and the uniqueness of the UK’s reserves. As I mentioned to my hon. Friend the Member for Middlesbrough South and East Cleveland (Luke Myer), the mine at Boulby, which I have visited, and hopefully soon the new mine at Whitby, which will be transporting material up to Teesside, both form an important part of the UK’s mineral resources. We expect and hope that they will continue to be exploited for some time to come.

British Industrial Competitiveness Scheme

Chris McDonald Excerpts
Monday 24th November 2025

(3 weeks, 5 days ago)

Written Statements
Read Full debate Read Hansard Text Read Debate Ministerial Extracts
Chris McDonald Portrait The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
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I can today announce to the House that the Government are taking the next step in delivering a flagship intervention of the industrial strategy, by launching a consultation to seek stakeholders’ views on the proposed approach and eligibility for the new British industrial competitiveness scheme.

In recent years, British industries have faced some of the highest industrial electricity prices in Europe. In the industrial strategy, the Government committed to bringing British industrial electricity costs more in line with other economies in Europe to level the playing field for British businesses for particular growth sectors.

The new scheme will reduce electricity costs for manufacturing frontier industries within the industrial strategy’s growth sectors—the IS-8—and foundational manufacturing industries that provide key inputs to the frontier industries which meet a certain threshold of electricity intensity. The scheme aims to reduce electricity costs for over 7,000 eligible businesses by up to £40 per MWh from April 2027.

Eligible businesses are to be exempt from paying the indirect costs of the renewables obligation, feed-in tariffs and the capacity market. The consultation seeks views on the proposed approach and how businesses eligible for the scheme should be selected.

By bearing down on costs across the energy system, we expect to deliver the BICS and ensure that the scheme is delivered in line with our wider priorities to deliver affordable power for businesses and households. For example, the proposals in the Department for Energy Security and Net Zero’s recent consultations on RO/FiT indexation, if implemented, could contribute to that goal.

This is a Government who are not agnostic about the fate of British industry and British manufacturing. Given a fair business environment, our industry and our workers can out-compete any others in Europe and most across the world.

We do not believe that the industrial capability of Britain should be solely at the whim of the international market or foreign Governments. Instead, our industrial strategy is a marked departure from the hands-off approach of the past, seeing the UK Government working in close partnership with UK industry to support private sector investment and growth—just as other developed economies have done and continue to do.

This scheme is just one of these steps under our new approach to support British businesses to remain globally competitive. I encourage hon. Members contact businesses in their constituencies that stand to benefit from our British industrial competitiveness scheme and to make their views known before the consultation closes on 19 January.

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